Wrong site delaying Posco plan: Orissa Congress chief (Interview)

July 18th, 2011 - 1:29 pm ICT by IANS  

Bhubaneswar, July 18 (IANS) The wrong site and a proposal to swap iron ore are delaying the $12 billion Posco steel project, says Orissa Congress chief Niranjan Patnaik, promising to return the land, “if it is free”, if his party comes to power in the 2014 assembly polls.

“The present site of Posco is what we had refused to hand over to the Indian Oil Corporation (IOCL) more than a decade ago,” Niranjan Patnaik told IANS, referring to the area in Jagatsinghpur district where India’s biggest foreign direct investment project is to come up but has run into severe protests from locals.

“Had the government offered non-agricultural land, the Posco project could have been carried out,” Niranjan Patnaik, 69, who took over as state party chief last month, told IANS in an interview.

“The government should have asked Posco from the beginning to relocate the project six kilometres away from the present site to avoid trouble,” he said.

The Biju Janata Dal (BJD) government in Orissa has signed pacts with around 50 companies so far to set up steel projects. But many of the big ticket projects have remained non-starters due to problems related to land acquisition and for alleged violations of laws.

“While signing pacts with companies, including Posco, the government should have done its home work properly,” Niranjan Patnaik said, citing the example of the Vedanta mining project that faced trouble due to green violations.

He cited an earlier Congress government decision to refuse permission to IOCL at the Posco site.

“We had refused them. We had offered them a different location and they had accepted,” said the 69-year-old who was a minister for nearly two decades in Orissa’s Congress governments and handled several important departments.

He said nobody should take credit for the investment proposals the state has received, including those in steel and power. “We received the proposals because of the changing economic environment,” he said.

The Congress leader, who was industries minister from 1986-1989 and 1995-1999, said while Chief Minister Naveen Patnaik had claimed there would be no forcible land acquisition, they were forcibly evicting people and acquiring land.

The South Korean steel major requires about 4,000 acres of land to build a 12 million tonne per annum steel project, a captive port and a captive power plant near the port town of Paradip, about 120 km from here.

Officials claim they have half the required land where the construction activities are in progress.

However, thousands of people have not been allowing officials to enter into the remaining area saying the project will ruin their agrarian livelihoods. They say the site has more than 2,000 betel leaf plantations which provide sustenance to villagers round the year.

“If the government removes people, we will take care of them,” said Niranjan Patnaik who is tasked with infusing new life into the Orissa Congress ahead of the 2014 elections. The faction ridden party has almost been lying dormant since it was voted out of power in 2000. Its strength in the 147-member state assembly is just 27.

“We will give those lands back to the people, provided it is free, if we come to power,” he said.

At the end of this month, the state government is set to renew the pact with Posco that expired last year. The Orissa Congress chief said the authorities should ensure that permission to swap iron ore - something the government agreed to in the earlier pact - is denied.

According to the memorandum of understanding (MoU) the government signed with Posco India June 22, 2005, Orissa will allow the company to export 30 percent of the 600 million tonnes of iron ore reserves to be allotted to it.

The company had said it will import an equal amount of high grade ore from Brazil for production of better quality steel.

He disagreed with the condition and said iron ore available in the state was of high quality and there was no need for the company to import it. “If the quality of iron ore is bad, why is Posco interested in setting up its plant here?”

He also said special economic zone (SEZ) status to the project and permission to build an independent port were also not essential. “I fear if the SEZ and port are allowed, Posco may have unhealthy competition with native industries.”

(Jatindra Dash can be contacted at jatindra.d@ians.in)

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