POSCO’s land acquisition in Orissa is illegal

South Korean company has started paying compensation to farmers


Prasanna Mohanty | July 28, 2010

South Korean steel major, POSCO, has begun acquiring land for its Rs 54,000 crore plant in Orissa in gross violation of law.

Firstly, its MoU with the Orissa government lapsed on June 22 this year and hence, the project has no legal status.

Secondly, since the state government has not complied with the Forest Rights Act and completed the process of granting forest rights to the forest dwellers (forest land accounts for bulk of the acquisition—3,000 acre of 4,004 acre to be acquired), it is completely illegal to acquire forest land.

Third, the central government has not given forest and environment clearance to the project yet.

In fact, the environment and forests ministry has withheld its clearance to the POSCO project on the ground that the Forest Rights Act has not been complied with. It recently sent former bureaucrat N C Saxena to do a reality check at the project site. Saxena’s report is awaited.

POSCO’s trouble goes beyond this. The Orissa High Court stayed the government’s attempt to give mining lease a couple of weeks ago saying that the laid down procure had not been followed in recommending its case. So, POSCO doesn’t have a iron ore mining lease to set up its plant.

In such circumstances, it defies logic for the state government to allow POSCO to acquire land, which it began by giving compensation to two villagers in Gadakujanga panchayat in Jagatsinghpur district yesterday (Tuesday).

POSCO has announced a compensation package of Rs 400 crore to acquire 4,004 acre of land in three gram panchayats of Jagatsinghpur—Dhinkia, Nuagaon and Gadakujanga. Of this, Rs 100 crore is meant for land cost, Rs 100 crore for rehabilitation and Rs 200 crore for compensation to encroachers on government land.



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