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Posco to start work on mega steel plant next month

Posco to start work on mega steel plant next month
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First Published: Mon, Sep 17 2007. 12 08 PM IST

In this picture taken 14 September, villagers displaced by the construction of a steel plant by South Korean steelmaker Posco, rest at a shelter for displaced persons in Jagatsinghpur district, some 1
In this picture taken 14 September, villagers displaced by the construction of a steel plant by South Korean steelmaker Posco, rest at a shelter for displaced persons in Jagatsinghpur district, some 1
Updated: Mon, Sep 17 2007. 12 08 PM IST
Parul Gupta / AFP
Bhubaneshwar: The protests have been loud and sometimes violent, but giant South Korean steelmaker Posco is confident opposition will fade when work begins on its massive Indian plant next month.
After a lengthy stand-off with aggrieved local villagers, preparatory work will start on the $12-billion project in Orissa within weeks, a company spokesman told AFP.
Construction will begin early next year and the first phase of manufacturing in 2011, bringing thousands of jobs for local people, he said.
The project represents India’s largest foreign direct investment, dwarfing the $2.9-billion Enron power plant in Maharashtra.
“The morale of the company is high. Once activities start, the rest of the villages opposing the project will also come around,” company spokesman Shashanka Pattnaik told AFP over the weekend.
In this picture taken 14 September, villagers displaced by the construction of a steel plant by South Korean steelmaker Posco, rest at a shelter for displaced persons in Jagatsinghpur district, some 100 kilometres east of Bhubaneswar. Posco said it was confident that villagers who will be displaced by its massive plant in India will drop their opposition once construction begins next month. AFP PHOTO
Feelings have also run high among thousands of residents facing eviction from the 4,004 acres (1,600 hectares) of coastal district earmarked for the plant.
In May, protesters briefly kidnapped three Posco employees and held them in a barricaded village before releasing them.
“Our demand is that Posco gives us in writing that it will not set up its plant here,” Anti-Posco campaign leader Abhoy Sahu told AFP at the time.
Tensions rose in April when 500 police were dispatched to the Jagatsinghpur district, shortly after security forces shot dead 14 protesters against a chemical plant in nearby West Bengal.
Amid the controversy POSCO, the world’s fourth largest steelmaker, has struggled to acquire the land it needs and currently owns just 193 acres.
But it hopes to buy another 300 acres soon, apart from the 1,135 acres it has already been promised by the government.
“The first phase of the operations will begin on this 1,600 acres,” the official said.
Posco has hit several roadblocks in buying land and mining rights since it signed an agreement with Orissa state in June 2005.
The federal government last month told Orissa to reconsider Posco’s mining application after allowing some 250 other applicants to enter the race.
But the company expects to win the lease in November and start mining by 2009. Under the 30-year lease rights, Posco will mine 600 million tonnes of iron ore.
“The Orissa government has recommended our case. On merit, we are the only players to qualify,” Pattnaik said.
The company, however, still faces tough resistance from villagers, many of whom oppose the plant and a port Posco will build nearby to import 30 million tonnes of raw material, including limestone, a year.
Residents of Jagatsinghpur, where authorities have blocked access by outsiders to many villages, say the plant and port threaten the livelihood of thousands of people.
Posco admits it’s been surprised by the scale of opposition, although it claimed to have won over several families during a visit by Soung Sik-Cho, chairman of the firm’s Indian unit, last month.
“Any project of this magnitude comes with its problems. We had anticipated this (the protests), but not to this extent,” Pattnaik said.
The company says it will create 18,000 direct jobs in the next 10 years — and was already giving education and training to several families.
“The younger generation is keen to take up work as it doesn’t see a future in agriculture,” Pattnaik said.
Posco says it has launched training programmes for local people in welding, masonry and carpentry. Women were being trained to stitch clothes.
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First Published: Mon, Sep 17 2007. 12 08 PM IST
More Topics: South Korea | Steel | Posco | villagers | Orissa |