Mint ePaper -Export ban of Iron Ore demand -Orissa, 36garh, Jharkhand, Rajasthan and MP CMs

Mint ePaper

CONTENTIOUS ISSUE - Mineral policy may skirt ore export ban·························· NEW DELHI

The much-awaited national mineral policy (NMP) is unlikely to address the contentious issue of banning iron ore exports.

"The issue of exports is not part of the NMP. It is a totally separate issue, which would be decided by the finance and commerce ministries, along with the Prime Minister's Office," said T.Subbarami Reddy,minister of state for mines.

The issue was also raised by the chief ministers of five mineral-rich states during their meeting with Prime Minister Manmohan Singh on Wednesday. In their memorandum, the chief ministers said:

"We strongly advocate that the export of minerals should be phased out since minerals are non-renewable and finite resources."

While the steel industry has demanded banning exports so that the minerals could be used for its expansion, the Anwar-ulHoda Committee, in its recommendations for the mineral policy, had favoured removing quantitative restrictions on overseas sales.

It had, however, said the issue could be reviewed after a period.

Reddy also said the ministry would consider the

demand of mineral-rich states to bar foreign direct investment (FDI) in mining of iron ore,

chromite and bauxite. "We have taken note of this issue and have assured them there concerns on the issue would be addressed," he said.

The chief ministers of Orissa, Rajasthan, Chhattisgarh, Jharkhand and Madhya Pradesh had opposed FDI in prospecting of iron ore, bauxite and chromite as a lot of local entrepreneurs are undertaking operations of these minerals.

Reddy also said the issue of passing on the cess collected from mining activities and constitution of a task force for finalizing the amendments to the applicable law would not be a part of the policy.

"We have told them that these issues will be looked into afterward as they are not part of the NMP."

The minister, however, said the states' demand seeking compensation for the use of minerals through an automatic advalorem based royalty structure has been accepted.

"The states wanted the advalorem to be about 20%, but we have said that the percentage could be fixed after discussions between the representatives of the states and officials from the mines ministry,"

Reddy added.

Tehelka:: Why Export?

Tehelka:: Free. Fair. Fearless
MPs question the Centre’s decision to export raw material rather than the finished product. SHANTANU GUHA RAY reports

WHEN OFFICIALS of the Brussels-based International Iron and Steel Institute (IISI) recently visited the Indian Capital, one concern uppermost on their mind was the government’s inordinate delay in finalising the National Mineral Policy (NMP).

But a crucial point in their deliberations with various stakeholders in the sector — and also with bureaucrats of the steel ministry — was the institute’s apprehension on allocation, conditions and stipulation of iron ore blocks for captive purposes.

IISI’s tensions are understandable. Its chairman is Ku-Taek Lee, CEO of South Korean steel giant Posco, whose Rs 52,000 crore, greenfield project in Orissa’s Paradip district is stuck in a logjam. The institute’s vice-chairman is Lakshmi Mittal, CEO of ArcelorMittal, whose Rs 40,000 crore, 12 million tonne steel plant at Keonjhar — the second biggest after Posco in Orissa — faces angry protests over its proposed acquisition of approximately 3,000 acres of land.

Unlike retail, NMP has not generated a nationwide debate on its benefits and tensions but a recent note — penned by the ministry — raised interesting points on the NMP that seeks to remove bottlenecks impending investments that New Delhi expects to cross Rs 1,00,000 crore mark over the next decade. The Ministry of Mines wanted to table the NMP in the winter session of Parliament and twice placed it on the Cabinet’s agenda but failed to get a nod.

But highly placed sources claim that the NMP could be delayed because of opposition from a group of Members of Parliament (MPs) who feel the NMP needs to have substantial inputs from the state governments as well as domestic industry before being cleared by the Cabinet.

A copy of the note, sourced by TEHELKA, shows these MPs sought strict regulation of the iron ore business with permission to export only after meeting the need of domestic metal-based industries. The MPs also demanded setting up of special mining zones (SMZs) in mineral rich areas by amending the Forest Conservation Act.

The MPs claimed since India was achieving a consistent GDP growth rate of 9-10 percent for the past few years, it is imperative for steel production to increase at 11-12 percent and the mining sector to grow at 13-14 percent per annum to maintain the trend. Hence, claims the note, India must have a steel production of 110 metric tonnes (MT) by 2010 and 300 MT by 2020 and approximately 200 MT & 500 MT of iron ore respectively, to meet this production.

“But there are different perceptions about iron ore reserves in the country. The Hoda Committee says we possess 23 BT of iron ore reserves whereas the Dang Committee refuses to believe that we have more than 10 BT of recoverable iron ore reserves and also suggests that out of 10 BT, only 6-7 BT are of high and medium grades; rest being low grade ores. We have no reason to believe that the Dang Committee estimates look like the most appropriate, keeping in view that few of our large deposits are also locked up in forest and environmental hassles where mining is not possible at all or even if the mining operations has started, it has to be stopped owing to institutional/ NGO pressures,” says the note.

“Even though we are not sure of our iron ore reserves, we are continuing to export huge quantities to competing countries like China, who takes this opportunity to acquire it at lower prices, courtesy Indian exporters. We exported approximately 94 MT of iron ore in 2006-07. Though India managed to achieve the present level of 45 MT of crude steel production at the consistent growth of 6-7 percent over the past few years, we could have done a lot better had we allocated iron ore mines to major steel producers and not exported such high quantities to countries like China,” say the MPs, adding: “If the same pace continues, the entire proven reserves of high-grade iron ore would be exhausted in less than 20 years.”

THE NOTE says the current mining scenario in India was disturbing, ostensibly because top producers like ArcelorMittal and POSCO did not get clearance for captive mining despite signing MOUs. Worse, convinced of a huge demand for steel in the world in future years due to high rates of growth in India and China, these companies were setting up new steel capacities in other countries.

The MPs felt India could have earned much more foreign exchange if it had exported steel, the finished product, in the same quantity as iron ore to countries like China, Japan and Indonesia. Even the highly acclaimed Hoda Committee feels that production of each tonne of steel is 7-10 times value added product than 1.6 tonnes of iron ore, claim the MPs.

Interestingly, per capita availability of iron ore is lowest in India at 22 tonnes per person as compared to 1,417 in Ukraine and 2,000 in Australia. “The per capita consumption is going to increase in the future years and it’s important that we save our reserves to meet future demands of domestic consumption,” says the note. The ministry, as of now, has not reacted.

Expert Opinion

India is formulating a new policy aimed at attracting foreign investment of Rs1 trillion ($21.5 billion) and creating five lakh jobs by 2011. The government intends to come out with a new policy as the existing policy of 1993 contains stringent provisions that restrict investors to put their money into the country’s mining sector which is ranked among the world’s top five for its reserves of coal and iron ore.

Zee News - Villagers at Posco site refuse to meet Medha Patkar

Zee News - Villagers at Posco site refuse to meet Medha Patkar

Villagers at Posco site refuse to meet Medha Patkar
Nuagaon, Dec 11: Villagers around the proposed Posco plant site in Jagathsingpur district on Tuesday refused to meet social activist Medha Patkar who immediately cancelled her programme and left for an undisclosed destination.

"I am sure the villagers are afraid to talk to me as they have been terrorised by Posco supporters," Patkar, who arrived at the site near Paradip where lands are being acquired for setting up a 12 MTA thermal steel plant.

With the villagers, who had earlier invited and even dined with the Narmada Bachao Andolan leader, remaining indoors, Patkar abandoned her plan to spend the night there and left for an undisclosed destination.

Patkar said she was trying to convince people that the Posco project would ruin them.

"Looking at their faces one can clearly see fear. People understand my words. But they are mute because of the restrictions imposed by the village committee comprising the pro-company group," she said.

Patkar who rushed to Kujang area from Nandigram this morning along with a few supporters, hoped that people would soon overcome their fear and raise their voices against the project.

While entering the village, which comprises nearly 1180 families, Patkar met a group of people who claimed to be supporters of the Posco project and urged her not to proceed as this could lead to tension.

Yesterday, a ten-member team led by a retired judge of Orissa High Court had claimed that the state government is perpetuating terror in the sea-side villages around the proposed plant site.

"We were told that the police is helping the hired goons and anti-socials to perpetuate terror," Judge Choudhury P K Mishra said.

Bureau Report

The Statesman - No Employment at Kalinga Nagar

The Statesman
Stir for jobs from Visa Steel

JAJPUR, Dec. 11: Hundreds of members of Vyas Unemployed Youth Organisation (VUYO), a forum formed for the interest of the local unemployed technical youths, staged an agitation in front of Visa Steel officers’ guesthouse today. It is located in Vyas Nagar, the gateway to the steel hub of India in Orissa’s Jajpur district.
The youths demanding jobs. The agitators, led by its president, Mr Bidyadhar Mohanty, locked up the guesthouse and prevented the exit and entry of Visa officials. Tension prevailed when security personnel of the steel company forcefully tried to drive the agitators out, and the latter in turn attacked them. After being informed, police reached at the spot and chased away the agitators.
Altogether 25 agitators were arrested and later released on bail. They were protesting against the engagement of non-Oriya people in the plant, located in the Kalinga Nagar by the Visa management.
The unemployed youths claimed that the steel plant has been utilising their area’s land and water and polluting the nearby villages around it. Hence the steel company should give priority to local candidates during appointments.
“After the Kalinga Nagar police firing in which at least 14 people were killed in police firing, while they were opposing land acquisition by Tata Steel plant on 2 January 2006, we were assured of being absorbed in the plants by the then Jajpur collector, Mr Arabinda Padhee.
Accordingly a directive was issued to the all the steel plants to engage local people first. But the Visa management is engaging non-oriya people,” said Mr Pradeep Samal, secretary of the VUYO.
“As per as advertisement, 39 technical youths had gone through the interview, both written and viva, on 13 May, 2006. We are educated and possess technical, engineering, and industrial training certificates, as advertised by the company about two years ago. But the authorities are yet to declare the result,” said Kailash Das, an engineering graduate.
He alleged that while aspirants are waiting for results, the company authorities, in the meantime, have appointed some non-Oriyas and outsiders. “During a bilateral agreement, it was decided that the steel company will engage local people in its plant on priority basis. But none is caring for the agreement and appointing the people as per as their wish,” he alleged.
Meanwhile, two FIRs have been lodged with the Jajpur Road police from both the groups. While the security officer of Visa Steel Mr AK Pati alleged that the agitators held them in confinement, Kailas Das, a member of the association alleged the company authorities threatened them of dire consequences for the agitation.
When contacted, AK Agarwal, vice-president (commerce) of Visa Steel however denied to comment on this matter. SNS

The Statesman

The Statesman
Vedanta launches three social development initiatives

Statesman News Service
BHAWANIPATNA, Dec. 9: Exhibiting that it remains unfazed by contentious issues raised in the wake of a recent Supreme Court verdict on its project here, the Vedanta Alumina company today launched three social development initiatives.
Head of Business development of Vedanta Mumbai Mr CV Krishnan, head of business development of the company told reporters that these initiatives related to rural electrification, child development/nutrition and education.
Project Ujaala , as the rural electrification programme is called involves expenditure of Rs 3 crore to provide infrastructure for electrification of 18 peripheral villages in Lanjigarh.
Project Udaya* for Kalahandi district involves selection of 15 meritorious students every year and they will be provided with all support to pursue higher education. And the Child welfare scheme will adopt all the 122 anganwadi centres of Lanjigarh Block. Under this scheme the centres will be upgraded with infrastructure, fun-based education materials, freshly cooked nutritious meals and preventive health care will be looked after.
The Vedanta group also programming for centralised kitchen to prepare and distribute hygienic mid-day meals to school children in Kalahandi in collaboration with the state government said Mr Krishnan. He claimed that the alumina produced during the trial production here was comparable to the best in the world. He further claimed that the rehabilitation done by the project at Lanjigarh is a model for the entire state. The project is providing employment opportunity to over 2,000 persons and this will go up 2,500 once the mining activity starts.
For the sustainable livelihood also through SHGs creating economic generation activities in the periphery villages and rehab colony in agriculture development, pisiculture and phyneol making. Similarly mobile health units operating in 53 villages and adopted also 53 villages under Sustha Parivar Scheme partnering health department for malaria, AIDS, sunstroke and small family. For child care activities 29 child care centres and one EGS school is functioning.
Opposition political parties had over the last fortnight demanded that the state government should ban Vedanta company following a Supreme Court verdict which has preferred its Indian wing - Sterlite Industries to undertake the project.

All that glitters is profit- Hindustan Times

All that glitters is profit- Hindustan Times

DAWN - Opinion; November 16, 2007 - Kuldip Nayar on Nandigram

DAWN - Opinion; November 16, 2007

Pragativadi - B. J. Panda's views

Pragativadi

YouTube - the blood rain

YouTube - the blood rain

The Telegraph - Calcutta : Opinion - While West Bengal Burns - by Dipankar Dasgupta

The Telegraph - Calcutta : Opinion

YouTube - Vedanta in Orissa

YouTube - Vedanta in Orissa

YouTube - Vedanta in Orissa

YouTube - Vedanta in Orissa

YouTube - dongria kond

YouTube - dongria kond

PIB Press Release - PIB release on new R & R policy of GOI

PIB Press Release
New R & R policy of GOI.

New R & R Policy -National Policy on Rehabilitation and Resettlement Bill, 2007, and Land Acquisition (amendment) Bill, 2007

T he Union government on Thursday approved a new rehabilitation poli cy that promises alternative land and future employment to those displaced in various land-related projects, in a move that will alter regulations that have been in place for 103 years.

In an unrelated move, the Union cabinet, led by Prime Minister Manmohan Singh, also decided not to pass on the burden of rising international oil prices to consumers, at least through March.

Both moves have significant political implications. One attempts to settle a fierce debate that has raged much of this year over displacement of people, especially farmers, from large industrial and export-oriented projects, including socalled special economic zones, or SEZs. The other simply avoids taking a fiscally prudent yet politically unpopular decision at a time when there is a possibility that India could be in for early elections.

The new rehabilitation policy also allows displaced people to hold a fifth of their compensation as equity in the new industrial unit that would come up on the acquired land, and maintains that acquisition of agricultural land for such projects should be kept to the minimum.

Among other decisions, the Union cabinet also announced a productivity-linked bonus to railway employees and cleared the outstanding dues of employees of 12 loss-making public sector undertakings.

The new rehabilitation policy will entail the introduction of a National Policy on Rehabilitation and Resettlement Bill, 2007, and Land Acquisition (amendment) Bill, 2007, which will replace the existing 103-year-old Land Acquisition Act. Cabinet spokesperson and minister Priyaranjan Dasmunsi said the new policy will apply to those uprooted by development project as well as natural calamities. "The details of benefit will be worked (out) when the law is framed."

The benefits under the new policy include land-for-land, which implies that a landowner whose land is acquired by the government will be given another piece of land. Other benefits include suitable employment opportunities, financial support, training facilities for those seeking self employment, pension for those who cannot work, and help in building temporary workplaces and houses in the resettlement areas for all those who will be uprooted. The policy also lays down that in case a company is able to acquire 70% of the land it requires, the government will step up to help the company acquire another 30%. However, all these provisions are subject to conditions. For instance, land-forland is subject to the extent of availability of land in resettlement areas and employment opportunities are subject to vacancies.

Analysts were quick to dub this as an election gimmick.

"More than anything, the announcement of this policy is a clarion call for early elections," said Bidyut Chakrabarty, head of the University of Delhi's de partment of political science.

"Land acquisition has been the Left's Achilles heel more than any other party and the Congress has only highlighted this once again through this announcement."

Some of the biggest protests against SEZs have been in West Bengal, the bastion of India's Left parties, which also help the current Congress party-led government claim a majority in the Lok Sabha.

D. Raja, national secretary of the Communist Party of India, one of the four Left parties that lend critical outside support to the ruling United Progressive Alliance, said the government has taken too long in announcing this policy. "It's good they have finally announced it," he said. "We'll of course study it in detail but what's important now is how the government plans to implement it."

Jivabhai Ambalal Patel, a Lok Sabha member of the Congress and a member of the parliamentary standing committee on commerce, which submitted a critique of the SEZ policy, maintained "this (policy) will not have an impact on elections because the voters have other considerations.

Awareness levels are appallingly low in a majority of the country." Patel, a Gujarat based industrialist, however, added only barren lands should be acquired for industrial projects.

The policy elaborates that at least one person in every uprooted nuclear family will be given an employment opportunity subject to the vacancies available with the government.

Besides, there is a special provision for a monthly pension to the vulnerable section such as those above 50, disabled, destitutes and widows.

The government is also expected to provide training facilities for those seeking self employment and provide scholarships for students. Financial support will be provided to affected families to rebuild temporary housing, cattle sheds, working sheds, etc.

The government will also set up an ombudsman for redressal of grievances, a national rehabilitation commission and a national monitoring committees, supported by a national monitoring cell. All Union ministries with major projects will have to set up new internal oversight panels. It has also introduced a mandatory social impact assessment for projects which displace more than 400 families in plain areas and 200 in tribal and hilly areas.

In yet another people-friendly measure, the government put on hold a long-pending hike in the heavily subsidized petroleum prices that would have brought them more closer to international rates, where a barrel of oil is hovering around $77. The crude oil price in the Indian basket is $75.53 per barrel as against the all time high price of $78.46 per barrel on 28 September.

It also announced a threeyear extension of the subsidy schemes for kerosene distributed through public distribution scheme and domestic liq uefied petroleum gas through March 2010. Both are used by most Indian households.

The government did pitch in to reduce the financial burden on state-owned oil-marketing companies by announcing oil bonds of Rs23,457 crore. Similarly, it had issued oil bonds worth Rs24,121 crore in 2006-07 and Rs11,500 crore in 2005-06. "The finance ministry will work out the duration of the oil bonds along with their date of issue. Though the Reserve Bank of India issues these bonds on the government guarantee, they will only show up on the government books at the time when they become redeemable," said one government official who did not wish to be identified.

Companies such as Indian Oil Corp., Bharat Petroleum Corp. Ltd and Hindustan Petroleum Corp. Ltd have been absorbing the subsidy arising out of the difference between the higher international price and domestic prices charged to the consumer. Taking into account the new set of oil bonds that are being issued, this burden would reduce to Rs18,312 crore.

"This (the bonds were) the next best option after a price hike," said Sarthak Behuria, chairman and managing director, IOC, India's largest oil marketing company. "We are happy, as the bonds will help us improve our bottom line."

The oil marketers lose around Rs4.35 and Rs6.90 on the sale of a litre of petrol and diesel respectively. The losses are Rs16 per litre of kerosene and Rs174 on every consumer gas cylinder sold.

sangeeta.s@livemint.com Ashish Sharma contributed to this story.

POPULIST REWARDS New rehab policy: affected families to get land-for-land and employment guarantees No hike in oil prices till March 2008; Government to issue oil bonds to underwrite subsidies Clears payment of outstanding dues to employees of 12 loss-making PSUs Payment of productivity-linked bonus to railway employees

The Pioneer > Home -Medha Patkar's foreign links

The Pioneer > Home

Probe Medha's foreign links, MPs urge PM

Navin Upadhyay | New Delhi Documents reveal attempt to woo judiciary Two Members of Parliament from Gujarat have urged Prime Minister Manmohan Singh to order an inquiry into the shocking evidence suggesting Narmada Bachao Andolan (NBA) leader Medha Patkar tried to influence the Government and the judiciary to obtain a favourable verdict in a case against her NGO in the Supreme Court.

Senior Congress leader Urmilaben Patel and Ratilal K Verma of the BJP, both MPs, have submitted identical evidence to the Prime Minister to establish that Patkar was in touch with a foreign agency, who wanted to oblige even a judge of the Supreme Court after he, along with another judge, dismissed a PIL against NBA. The PIL was filed by the National Council for Civil Liberties, a Gujarat-based NGO alleging that NBA was engaged in anti-national activities.

The MPs have enclosed email correspondence between Patkar and Patrick McCully, former director of the International Rivers Network at Barkley in the US. The correspondence shows Patkar claiming she had put pressure on the UPA Government, which was also served a notice by the court to respond to the charges of NBA's involvement in anti-national activities to stop construction of work at Sardar Sarovar Project in Gujarat.

The sequence of email correspondence between McCully and Patkar is revealing. Minutes after the SC dismissed the NCCL's PIL on July 10, 2007, McCully was informed of it by one Phillip through Patkar's email address.

Next day, McCully wrote back to Patkar, "You have mentioned in your message (email) that Judge Thakkar (CK) is ex-chief justice of Gujarat and anything can happen. How you manage this. What was the second judge?"

In reply, Patkar wrote back on July 13, "Phillip made a mistake in quoting Thakkar as the ex-chief justice of Gujarat. He was initially judge there. Justice Altamas Kabir wrote the judgement."

Patkar also wrote that many eminent persons wrote to the UPA Government and her advocates supported them. "We dealt with the press very selectively and ensured that pressure was kept all through."

"Along with this, the petitioner's case was so weak. Its triviality was obvious. Legally it was non-maintainable," she added.

To this, McCully responded on July 17, "I was keeping a constant watch on this case. I was actually disturbed after reading written submission of Saxena (VK Saxena, chairman NCCL, the petitioner), which he had posted on his website. Not a shred of reference in the judgement. You have managed it very effectively."

McCully's email underlines the fact that Saxena's petition had disturbed him and he was happy to see that the charges levelled against him were not even touched upon in the judgement. The reference to "managing" the whole thing is significant.

McCully added they would like to honour those people who supported Patkar in the case. "You can send a list of 5-6 people with their very brief background in 2-3 lines. The function can be organised in London instead of the US through other groups. With his strategy these people could be more committed to your cause."

And then he added this bit of shocking offer: "We must honour Judge Kabir for supporting you. Please explore the possibility. He will retire in 2013 -- a very useful man for your further battles."

It is well known that Justice Kabir is a respected judge with impeccable career record. While there is nothing to show he obliged Patkar, McCully's mail clearly showed a sinister design to woo him to help NBA in future.

In her reply sent to McCully on July 22, Patkar felt that openly obliging her benefactors would be counter-productive. "Thanks a lot. Other than advocates, no one would like to be acknowledged for writing to pressurise the Government. That might boomerang."

Referring to the email, both the MPs asked the Prime Minister to order an inquiry into the whole episode.

Verma has pointed out to the Prime Minister that the exchanges between Patkar and McCully are "explosive and dangerous to the extent that they show foreign interest and support to a group that is indulging in obstruction to the country's development. It carries blatant suggestion that July 10 Supreme Court judgement was managed."

Urging the Prime Minister to order an inquiry to identify those who tried to put pressure on the UPA Government and the judiciary to favour NBA, Verma asked, "When even the thought of influencing the judiciary at any level is contemptuous, is it not a case of sedition against the NBA -- a group working with foreign aid?"

Echoing similar views, Urmilaben Patel has asked the Prime Minister that "the Government should immediately inquire as to how Medha Patkar managed a favourable verdict And take appropriate action against Patkar for bringing disrepute to the Government and to the Hon'able Supreme Court and halting the process of national development with foreign support."

Will Mittal Steel be a raw deal for Orissa?

With Mittal Steel moving into India, it becomes even more important to look at the firm's poor environmental and social track record around the world in its rise to become the world's largest steel maker. There are crucial lessons for the governments of Orissa and Jharkhand, but are they listening, asks Sunita Dubey.

8 August 2007 - Laxmi N Mittal, the Chairman of Arcelor Mittal, the largest steel company in the world has come to his country of birth to set up two steel plants in Jharkhand and Orissa of 12 million tonnes capacity each—and an investment of approximately 18 billion dollars. Although the deal with Jharkhand has run into a hurdle over mining lease, the politicians and bureaucrats—from Delhi to Bhubaneswar—have given him a red carpet welcome in anticipation of huge investments.

Mittal Steel Plant, Vaal Triangle, South Africa. Even as Mittal was negotiating a deal with the Orissa government in India with a promise of environmental and social compliance, the South African government began a criminal investigation into Arcelor Mittal's malpractice at another Mittal plant there. Pic: Groundwork.

With Mittal Steel moving into India, it becomes even more important to look at the kinds of practices adopted for the firm's rise from a small family business to the world's largest steel company, operating 61 plants in 27 countries. Not surprisingly, the company has come under scrutiny worldwide already. The company's success has been primarily based on buying up old state owned steel factories in places like Trinidad, Mexico, Poland, Romania and Algeria throughout the 1980s and '90s at very cheap prices in nations with weak or nonexistent unions and environmental and human rights norms, reported the MSNBC in February 2007. Mittal Steel is also known for buying political influence in acquiring steel assets in other countries. For example, former British Prime Minister Tony Blair, intervened to help Mittal steel buy a giant Romanian steel company a month after the tycoon donated 10 crores (£125,000) to the Labour Party. In an extraordinary letter, Blair told
Romania's prime minister that selling his biggest state-owned enterprise to Laxmi Mittal, would enhance the country's chances of joining the European Union, according to an October 2002 report in the The Telegraph. Even Indian politicians were not far behind in supporting Mittal in its acquisition of Arcelor, the second largest steel company in the world in 2006. Commerce Minister, Kamal Nath, wrote to the European Union arguing for the acquisition. The prime minister Manmohan Singh ended up taking this issue with visiting French President, who was initially critical of this deal because of the anticipated job cuts in France and other parts of Europe. Orissa's push towards steel Arcelor Mittal is all set to invest approximately Rs.40,000 crores (approximately US$9 billion) to build an integrated steel plant with a total annual capacity of 12 million tonnes in the iron-rich Keonjhar district, the company says on its website. According to the memorandum of
understanding (MoU) signed on 21 December 2006 the plan consists of building coke oven, steel making, rolling mills, and a 750 MW captive power plant. Mittal has asked for 8,000 acres of land at the proposed location: 6,000 acres for the plant, 1,000 acres for a power plant, and 1,000 acres for a township, according to press reports. The land requirement is almost double the size of the land sought by Posco a South Korean Steel Company, which just received an environmental clearance for setting up a steel plant of similar capacity at Paradip, Orissa. Mittal Steel claims that the excess land is needed for its future expansion plans. Orissa's tryst with steel does not just end at these two mega steel plants. In the last two years, Orissa government has signed about 40 steel plant proposals in the state. A projected 44 million tonne capacity is expected to be built in Orissa, with a massive investment of about Rs.108,000 crores. Out of these, five major national
and international players alone are pumping in Rs.95,400 crore to build a capacity of 32.5 million tonnes, says the state government. Mittal pulling strings Mittal Steel has sought a special economic zone (SEZ) status for its plan. If granted, it will not only result in substantial tax savings, but also would give Mittal the leeway to bypass many environmental regulations. Under the garb of corporate social responsibility, the steel company has pledged its support to the community and appointed a consultant, the New Delhi-based IL&FS EcoSmart Ltd. to do a socio-economic survey and prepare the Relief and Rehabilitation (R&R) package for the project affected people. EcoSmart provides resettlement support services for the World Bank-funded Mumbai Urban Transport Project (MUTP). However, based on the Bank's own Inspection Panel report documenting the abysmal rehabilitation and resettlement of the project, the World Bank had withheld upcoming installments to the
project. This is the track record of the company hired by Mittal for their own project's R&R.



Meanwhile, Sanak Mishra, CEO of Mittal India operations, says that "the company would take the Orissa government's R&R policy as a guideline for the package". The problem lies in the very fact that R&R policy of Orissa government is already marred with problems like failure to ensure employment guarantees for the displaced. The onus is on company to employ the displaced. The policy also remains silent about the government's role in cases where people do not want to be displaced by the industrial projects, according a Down to Earth report.

Rusty track record The danger for India is that Mittal Steel has a global reputation of having no regard for environment, communities and fair labour practices in countries where it operates steel mills, such as Ireland, Mexico, Romania, Poland, South Africa, United States, etc. In South Africa, the communities are fighting against Mittal Steel's pollution as well as intimidation against families who have refused to sell their land for their expansion plan. Even as Mittal was negotiating a deal with the Orissa government in India with a promise of environmental and social compliance, the South African government began a criminal investigation into Arcelor Mittal's malpractice at their Vereeniging plant for continued dumping of hazardous waste at an unauthorised site, despite repeated instructions to stop. A July 2007 investigation detailed environmental and legal contraventions, and significant pollution of surface and groundwater with phenols, iron, oil,
fluoride and other hazardous substances. In September 2006, 41 miners died in Arcelor Mittal-owned Lenin coalmines in Kazakhstan and meanwhile the workers went on strike demanding pay raises and improved safety. Workers have also alleged that Arcelor Mittal has done little to improve labour and safety conditions since taking over Kazakhstan's largest metal factory and its associated mines, according to a report in the International Herald Tribune. What's more, Mittal's flouting of environmental and labour norms is not limited to just developing countries. Even in the US, the company has provoked regulatory action and citizen protests. In August 2006, the US EPA cited Mittal Steel USA Inc. for alleged clean-air violations at the company's steel mill in Indiana, stating that Mittal modified a coke oven battery that resulted in a significant increase in sulfur dioxide emissions, without getting a state permit. The state requires the best available technology to
control the emissions. Local protest against Mittal Steel, in Ohio, United States. Pic: Ohio Citizens Group.

At an Ohio steel plant, which Mittal Steel took over in 2005, local communities are up in arms over the high levels of pollution and related health problems. Since the takeover, the pollution record of the Ohio plant has deteriorated — they quietly admitted to the Ohio EPA that the plant spewed 3.2 million pounds of pollution more than its 2005 emission of 41.0 million pounds, into the air over the city of Cleveland in 2006. The emissions include carbon dioxide, soot, volatile organic compounds, and lead. Mittal's record of addressing public grievances has also been awful. Laxmi Mittal and his CEOs in the US have continuously denied the communities' demand to engage with the public in Ohio despite citizens sending 24,500 personal, handwritten letters and petitions. Deja vu in Orissa? Just weeks after the MoU between Orissa government and Arcelor Mittal was signed, the people of Keonjhar started protesting against the deal. Taking note of the plight of other
communities evicted due to a myriad of development projects in Orissa, people are not ready to give away their lands, which is often their only source of livelihood. Angry villagers from 17 villages have also demonstrated in front of Keonjhar District Collector's office demanding that their land should not be acquired for the Mittal steel plant. The land sought for the project is a multi-crop, fertile, and irrigated agricultural land. The voice of these people is strong, and it is likely that they will not give up their land easily, which will be a problem for both the Orissa government and Mittal. For its part, the Orissa government has so far paid more attention to the Mittal's possible investment than its well-established record of flouting environmental and social norms. If the government tries to force Arcelor Mittal Steel on its people, it may once again face a situation like Kalinganagar. The tribal people of Orissa, who are poor and are always asked to move
and give up their livelihood, will not hesitate to resist -- because they are being left with no choice. It is yet to be seen whether the Orissa government has learned anything at all about its people and their will. ⊕ Sunita Dubey
8 Aug 2007
Sunita Dubey is based in Boston and is a coordinator of Groundwork, which works on environmental justice issues in South Africa.