Tags:
Journalism of Courage
South Korean steel giant Pohang Iron and Steel Company (Posco) has hit out hard at what it calls a “politically biased society”, saying that it makes no business sense setting up the Orissa plant without a mining lease. However, the company is unfazed by the over a year’s delay for its $12 billion mega project and and is still “hopeful” of starting Phase I construction of the 12 million tonnes per annum steel plan in Jagatsinghpur (Orissa) from April 1, 2008. With one condition: mining lease is granted.
“The politically biased society here is posing lots of hurdles in setting up the steel plant and has resulted in delay of the project of more than a year,” said Soungsik Cho, chairman cum managing director, Posco India. “We, however, do not intend to withdraw unless asked to leave. Both the governments (Centre and the state) are trying their best to see that this biggest foreign direct investment goes through.”
When asked if the company would still go ahead with the project if mines were not allocated, Cho said, “It is not likely to happen. But without mines there is no reason to come to India and it is not a viable proposition to set up plant here then.” Assured supply of iron ore would compensate for problems such as poor infrastructure, communication, power and problems relating to land acquisition, he added.
The state government has already assured its full support for the project. “As per the memorandum of understanding signed with the company in 2006, the state government would provide all possible help for the project including security if anybody tries to stall the project,” said an official at the chief minister’s (Orissa) office.
That’s easier said. “We would not let the construction work start as it is coming up on agricultural land,” said Abhay Sahu, president, Posco Pratirodh Sangram Samiti, a Left-backed organisation opposing the plant. When asked the reason for opposing the plant he said, “We do not have any demands.”
Land acquisition for the plant is the biggest hurdle the Rs 47,000 crore project is facing today. Of 4,004 acres required for the project, “only 300 acres is agricultural land and 39 acres is double crop land,” a senior Posco official said. “There is actually no agriculture happening on 300 acres.” Of the eight villages whose land needs to be acquired, seven have signed up.
The issue then comes down to compensation. The company recently announced its rehabilitation and resettlement (R&R) package. “The compensation we have worked out for displaced families is by far the best possible package and is likely to help the company start construction work from April 1, 2008,” said Vikash Sharan, senior general manager, Posco India.
The package, announced on February 1, talks of providing houses to displaced families in a rehabilitation colony adjacent to the project. During the construction stage, one member of each project-affected family would be engaged in the construction job, through a contractor. Once the plant is up and running, one member of a displaced family will be trained and employed. In addition, the company is also offering compensation to those who encroached on government land.
“The company is offering Rs 8 lakh per acre to people who encroached on the government land and were dependent on the land for their livelihood,” said Damodar Raut, MLA and former Panchayati Raj minister. “Though there is no provision to compensate those who encroached, we are going out of the way as we do not want to disturb their livelihoods.”
