Since 2004, some of the country’s largest steel companies such as Tata Steel Ltd and Jindal Steel and Power Ltd, Korean steel maker Posco and Vedanta Resources Plc. have tried to cash in on international demand by signing preliminary agreements worth Rs1.08 trillion with the Orissa government to set up steel plants in iron ore-rich areas such as Jajpur, Deonjhar, Keonjhar and in the port town of Paradeep.
But more than ever before, clearing these small leases, so that new jobs can be created in Kandhamal, has become critical, amid the simmering Kandha-Pano conflict. Security experts believe that if this conflict is left unresolved, the district with its thick jungles and disaffected people is likely to become a haven for Maoist guerillas.
“If their economic problems are left unheeded, then these people are likely to become sympathizers of the Maoists,” says A.N. Sinha, deputy commissioner of police in Cuttack, who has served three years in Gajapati, a district of Orissa that borders southern Kandhamal. Maoists are active in Gajapati.
On 5 November, an activist of the Hindu-nationalist Rashtriya Swayamsevak Sangh (RSS) in Kandhamal, Dhanu Pradhani, was gunned down by suspected Maoist rebels.
“Three men walked up to him and fired more than five bullets into his body. We have also discovered a poster,” says Praveen Kumar, superintendent of police in Kandhamal.
And if policy improves, investors say they will come to this district, despite the recent conflict. “Conflict will not keep mining companies out. I would certainly be interested in going there,” says Panda of Imfa.
Like him, many are convinced that economic development could help defuse tensions between the Kandhas and Panos. Riots broke out in Kandhamal on 23 August, when armed assailants broke into a Hindu ashram and gunned down Swami Lakshamananda, a Hindu leader who had led a movement against Christian missionaries in the area.
In a retaliation that lasted several weeks, mobs torched Christian homes and churches, killing 38 and displacing thousands.
“We generate employment. We employ locals at our mines in Jajpur and Rayagada; we employ them for dispatches, bringing in equipment. Then there is a multiplier effect. Other jobs come up with a mine,” Panda says.
To win over locals, companies also undertake social projects; Imfa reports spending 2% of its net profit (approximately Rs412 crore every year) to set up health and veterinary camps and to build hospitals and schools in Orissa.
Locals, too, say they would welcome the mining companies. Asthik Digal, a Pano who is a stone-breaker and migrates to earn daily wages of Rs200, says he would rather work in a place close to his family. “If I get a job here, why will I go so far from my wife and children? I will stay here and work in a mine,” he says.
But right now, the idea of industries, schools and hospitals in Kandhamal seems like a distant dream, says Prusty.
He may be right. Because even though there is a lot of investment coming into the state—Orissa has signed about 50 preliminary agreements worth about Rs1.98 trillion to set up steel plants—the government’s mining policy is deficient, by many accounts.
To begin with, the state has not updated its mineral map (map of all the resources in the state) in 30 years.