MAC: Mines and Communities

South Asia update

Published by MAC on 2007-04-13

South Asia update

13th April 2007

Will it never stop? Rural resistance to new steel projects in eastern India continues to rise -and now Amnesty International has lent its support to the resisting farmers.

As Bangladesh enters its fourth month of the "emergency", the interim government continues to vacillate over the country's biggest-ever proposed mining project - the Phulbari coal mine, supposedly leased to Global Coal Management (formerly Asia Energy).

Orissa villagers damage roads protesting steel plant

12th April 2007

Hundreds of villagers, protesting the proposed steel plant by a South Korean firm in their area, Thursday damaged roads and set up barricades in this Orissa district to prevent the police or company officials from entering their villages.

'The villagers cut off roads at three places after the local administration deployed over 500 policemen in our locality,' said Abhaya Sahoo, a leader of a local organisation that opposes the proposed steel plant by South Korea's POSCO.

The roads linking Nuagaon, Dhinkia, Trilochanpur and Gobindapur villages were cut off by villagers, said Sahoo, who is the president of POSCO Pratirodh Sangram Samiti (PPSS).

POSCO, one of the world's biggest steel makers, signed a deal with the state government in June 2005 to set up a $12 billion plant near the port town of Paradeep by 2016. However, there has not been any significant progress on the project due to local opposition.

While the state government claimed that it deployed police personnel to bring normality in the area and to help the administration conduct local bodies election, villagers alleged it was an attempt by the local administration to acquire their farmland for industrial use.

Elections to local bodies were held in February across the state barring some villages in the region following clashes between supporters and protestors of the proposed steel plant.

According to Sahoo, hundreds of villagers are guarding some other roads to prevent policemen and government officials from entering the district.

'The villagers have also placed wooden gates at nine places to prevent the entry of any officials,' A. Panda, a local police official, said.

More than 20,000 people of about 15 nearby villages including Dhinkia, Gada Kujanga and Nuagaon have been opposing the project, fearing eviction. The villagers say the project will displace them and ruin their betel leaf farming.

POSCO, however, says although the plant would affect only 500 families it will create thousands of jobs


Public Statement

AI Index: ASA 20/009/2007 (Public)
News Service No: 069
11 April 2007

India: Orissa should avoid forced evictions in Jagatsinghpur, instead consult farmers protesting against displacement

Amnesty International is deeply concerned at reports that farmers in Jagatsinghpur in the eastern Indian state of Orissa, protesting against their proposed displacement by the state government for a new industrial project, currently fear forced evictions at the hands of the state police force.

Tension has been high in Jagatsinghpur district after 1,000 officers of the state police force encircled Dhinkia, Nuagaon and Gadakujang panchayats, apparently preparing to enter the area. Several villages in the area have been the scene of protests by farmers for the last 14 months against their displacement due to an integrated steel plant to be set up by the South Korean firm, POSCO.

Amnesty International urges that lessons should be learnt from the unfortunate episodes of violence which recently unfurled themselves in Kalingar Nagar (in Orissa) and Nandigram (in neighbouring West Bengal). The use of police force – in a context where consultations have not been held with protesting local communities – resulted in 13 deaths in Kalinga Nagar and at least 14 deaths in Nandigram, apart from serious injuries.

Amnesty International wishes to remind the Government of Orissa of Principle 9 of the Basic Principles on the Use of Force and Firearms by Law Enforcement Officials, which says that "law enforcement officials shall not use firearms against persons except in self-defence or defence of others against the imminent threat of death or serious injury, to prevent the perpetration of a particular serious crime involving great threat to life, to arrest a person presenting such a danger and resisting their authority or to prevent his or her escape, and only when less extreme means are insufficient to achieve these objectives." Any action by the police must be in proportionate response to the action by demonstrators and should avoid unnecessary injuries to civilians.

Amnesty International believes that full consultations about the human rights impact of economic decisions with those to be affected are vital means through which human rights are safeguarded in the context of development.

Amnesty International seeks to remind governments of their obligations to find ways of balancing respect for human rights with attempts to achieve economic growth. Amnesty International reiterates that sustainable development cannot be measured solely in terms of economic indicators: it is a holistic process that embraces the development of civil society, the strengthening of the rule of law and the fulfilment of individuals' and groups' aspirations in the civil and political, social and cultural as well as economic spheres.

In this respect, the organisation reiterates its demand that the Government of Orissa should:

a.. avoid forced evictions;

b.. announce and implement a consistent policy of full consultation with local populations before any development which could affect their livelihood can take place; and

c.. ensure that, where it is proposed to resettle populations, there is just, adequate and culturally-sensitive rehabilitation, resettlement and reparation for those affected.


Since June 2005, Jagatsinghpur district has witnessed frequent protests against possible displacement following the Government of Orissa's decision to enter into an agreement with POSCO to enable the latter to set up its integrated steel plant. Since February 2006, protestors have erected barricades in the area where the plant is to come up and prevented officials from entering several villages. The area witnessed violence in February 2007 when elections were held to local bodies in Orissa.

Posco: Govt warned against use of force

Statesman News Service


10th April 2007

The massive mobilisation of police force in Kujang area of Jagatsinghpur district prompted Opposition political parties and social outfits to warn the government against any use of force in the proposed Posco project area.

Those who have opposed the project refused to budge from their stand and did not lift the check gates which have successfully prevented entry of government as well as company officials to the project site for over one and half years. The inordinate delay, innumerable police cases and clashes between pro and anti-Posco groups, coupled with the fact that the panchayat elections are to be held in some of these areas has prompted the state government to deploy armed police to clear the approach roads.

There is considerable tension in the area as the police operation of moving into the villages had reportedly been chalked out during DGP Mr Amarananda Patnaik's recent visit to the spot. Sensing trouble the anti-project groups have also renewed their pledge to prevent entry of police and project authorities while a pro-project faction has also geared itself up for a showdown with their rival group.

We hope the government has learned lessons from the Kalinga Nagar incident and also from the Nandigram carnage in neighbouring West Bengal, said Opposition leaders even as the ruling BJD circles underplayed the forced mobilisation. Chief minister Mr Naveen Patnaik described it as just normal procedure to ensure law and order in the area.

But Opposition leader Mr JB Patnaik cautioned of a replay of Kalinga Nagar if police was used to crush democratic rights of people. Talking to reporters the Opposition leaders said 20 platoon has been moved to the area and people suspect intimidation and force will be used to acquire land for the project which has been resisted for two years now.

The area is agriculturally rich and is similar to the Baliapal region where a strong peoples movement and forced shifting of the proposed National Test Range in the eighties recalled Mr JB Patnaik. The Congress was in power both at the Centre and the state, it wanted the NTR to be established in the interest of the nation but we bowed to peoples pressure and farmers of the area, he observed.

When his attention was drawn to the fact that the UPA government was keen on the Posco plant coming up in Orissa, the veteran Congress leader remarked: "It matters little even if the entire world were to support the project, what is important is that the locals and farmers are opposed to it and their democratic rights should be respected".

Replying to a question on the fact that panchayat elections need to be held and the police was being deployed to facilitate this, Mr JB Patnaik shot back saying why doesn't the government announce like it did in West Bengal that the project will not come up at that site.

Elections can be held the very moment they make such an announcement, he remarked.

He also raised issues relating to the iron ore, water and product-line of the proposed Posco project. Mr Prafulla Samantray of Lok Shakti Abijan which has been associated with several resistance movements in the state also warned the government against use of force.

Reports from Jagatsinghpur said the police was likely to move-in to the villages and dismantle the check gates within a day or two.

The agitating villagers had disobeyed directives of the administration and not one of the ten check gates have been raised so far.

SP Mr YK Jethwa claimed that the administration was negotiating with local people to ensure smooth and voluntary removal of the check gates. At the same time the police is prepared to take stern action against criminals and anti-socials who create unrest in the area, he added.

The force mobilisation is on and reinforcements have been sent from different districts. Mr Jethwa said 12 platoon police forces have already reached Kujang and additional women police were on their way from other districts. Meanwhile villagers continue to be tense and quiet a few families have left fearing police action. The most sensitive areas are under Dhinkia, Gdakujang and Naugaon panchayats.

Orissa mulls tough action against anti-Posco activists

Pioneer News Service. Bhubaneswar

10th April 2007

* Centre calls high-level meeting
* Hurdles to be cleared within three months

The Orissa Government has decided to take tough action against anti-Posco activists and remove all impediments on the path of establishing Posco's proposed plant at Paradip.

"If all obstacles would not be removed through dialogue, tough action would be initiated against those who oppose the Posco-project," said a senior Government official on the condition of anonymity.

The Jagatsinghpur district administration has sought for more police force in this connection. The district administration has issued notices to the Samiti members and Sarapanchs of Dhinkia, Patana, Gobindpur and Gada Kujanga to clear the gates erected at the thoroughfares in these villages. These are the villages, where the South Korean steel giant has decided to set up its 12 million tonne per annum Greenfield steel project with an investment of $12 billion.

The district administration has fixed April 5 as the dead line to remove eight bamboo gates, which have been erected on both sides of the four villages. The people in these areas have erected 8 gates in Dhinkia, Gobindpur, Nuagaon and Trilochanpur to restrict entry of Posco and Government officials into these villages.

Meanwhile, Chief Minister Naveen Patnaik on Wednesday called a high level meeting at the State Secretariat to decide future course of action. As per the decision of the meeting, Government will take soft stand and persuade anti-activists to help administration so that the proposed Posco project can become a reality.

"If activists don't support the Government stand, the Government would take all possible mean to clear the hurdles," said officials of the State Mining Department. "All obstacles would be removed within three months," said State and Mines Minister Padmanav Behera.

It may be noted that due to continued resistance, the State Government was unable to acquire lands. Posco is waiting to acquire 4004 acres of land in seven villages of Kujang Tehsil in Jagatsinghpur since it signed a memorandum of understanding (MOU) with the State Government on June 22, 2005.

Even the Government was unable to conduct panchayati election in 13 booths in these areas. The Centre has also expressed its annoyance with the State Government's failure to settle the land acquisition issue and acquire land for Posco's proposed project.

In this connection, the Centre has called a high level meeting at New Delhi to deal with the issue. Chief Minister is expected to attend the meeting and meet the Prime Minister. However, Chief Minister Patnaik expressed hope that all the matters would be amicably settled taking the human values into consideration. Jagatsinghpur SP Yaswata Yethua said if the talks fail, stringent action would be taken against them.

However, Abhaya Sahu, president Posco Pratirodh Sangram Samiti (PPSS) is adamant over the issue of allowing officials to enter the village. Sahu said "Let the Government use force, there will be another Nandigram and Posco will take over land over our dead bodies".

Fear of fresh stir in steel hub

Times News Network

11th April 2007

Jajpur: The tribals in Kalinga Nagar might have softened their stand and lifted the year-long road blockade. But, the anti-industrial movement in the steel hub continues to haunt the district administration and industrialists.

The fresh fear of conflict surfaced on Monday when thousands of farmers from Danagadi, Korei, Sukinda and Dharamsala blocks threatened to stage an agitation against the proposed ash pond of Jindal Stainless ltd. at Sukindapata on the outskirts of the industrial complex area. At a meeting organized by the Sukindapata Chasi Samiti near Jakhapura Hingula emple, the farmers decided to launch an agitation on the lines of Kalinga Nagar.

"We will fight against the proposed ash pond as it will be a major threat both for our lives and the future generation. We will not give company any land. We are ready to face the company," Gopinath Biswal, a farmer said.

According to sources, Sukindapata, a land for multi-cropping, is spread over an area of 6,500 acres. Jindal Stainless Ltd. reportedly wants to acquire 5,000 acres for its ash pond project.

According to sources, nearly five lakh people in about 100 villages on both both sides of the Brahmani, the Kharasrota and the Ganda Nala rivers will be adversely affected if the ash pond comes up. These people use water of the the three rivers.

"The water of the three rivers will become poluuted as the proposed pond's discharge will flow into them. It will actually turn into a pond of poison for lakhs of people in the four blocks of Jajpur," claimed Sarat Samal, a local resident.

CPM [Communist Party of India Marxist] leader Mayadhar Nayak criticized the district administration for allowing the company to dig up an ash pond in the Sukindapta area "in violation of the central and state govt guidelines".

"If the pond is dug up, thousands of people will lose their livelihood. Besides, around 5,000 traditional fishermen, who are depending on the rivers for years together, will lose their livelihood," Nayak warned.

Arabinda Ku Padhee, the outgoing collector of Jajpur, said, "the land that the company wants for its ash pond belongs to the govt. However, some local people, who said it was not recorded in their names during the period of settlement, are now claiming rights over the land. Sukinda tehsildar Kulamani Pati is conducting inquiry into the matter."

Anand Kishnan, the public relations officer of Jindal Stainless Ltd, said the environmental aspects would be looked into before digging up proposed ash pond.

Jharkhand seeks higher royalty for coal, iron ore

India News

13th April 2007

Jharkhand has sought a 20 percent share in the centre's profits from coal and iron ore, saying delays in the revision of royalty on minerals mined from the state were causing it a loss of Rs.35 billion annually.

The demand was put forth at a two-day meeting of the Inter State Council of Mineral Resources (ISCMR), which began Thursday at the Indian Institute of Coal Management (IICM), Ranchi.

The meet is being attended by the chief secretaries of 14 states, which include Jharkhand, Chhattisgarh, Andhra Pradesh, Rajasthan, West Bengal, Tamil Nadu, Gujarat, Goa, Nagaland and Orissa.

Jharkhand Chief secretary A.K. Chug demanded a 20 percent royalty on profits made from coal and iron ore mined from the state.

Jharkhand officials believe if this demand is accepted by the central government, the state will earn an additional Rs.35 billion per annum. At present, Jharkhand gets Rs.11 billion as royalty.

Chhattisgarh representatives supported Jharkhand's view.

The representatives of different states are discussing royalties paid on different minerals by the central government. The delegates also talked about the low rates paid on iron ore despite a boom in the steel industry.

States demand profit share


Ranchi, April 13: Two-day inter-state council meeting, attended by chief secretaries and energy secretaries of 12 states, has concluded without making any recommendation.

Council secretary Amitabh Pandey today indicated that the Union government would be presented a final report in November.

This meeting at Ranchi, he said, was meant to merely elicit the views of the states seeking adequate compensation. The council deliberated on a draft report prepared by TERI (Tata Energy Research Institute) on the states' demand on enhanced royalty on natural resources and also on royalty based on value or price rather than tonnage.

Pandey confirmed Orissa, Jharkhand and Chhattisgarh raised the issue of "profit sharing". Since coal and steel companies have been earning profits of several thousand crores, primarily because of increasing demand and price-rise in the international market, the states suggested that the companies share this profit with them. This was opposed by the companies and Coal India Ltd chairperson P. Bhattacharya made a spirited plea for states to first become stake- holders or share-holders of the companies.

The states countered by saying that since the Centre was considering the proposal of several states that they be given 12 per cent of the power generated by hydel units based in these states, either free or at a subsidised rate, there is no reason why mining companies should not share profit earned from exports and otherwise. TERI in its draft proposal suggested a mechanism that could be adopted whereby states get a part of the production or profits that the companies make. This, TERI, felt would tackle the grievances of the states demanding higher returns for the minerals mined.

The council dropped hints that this proposal could figure prominently in the list of suggestions to be sent to the Centre. Pandey, too, felt profit sharing proposal was better than having new taxes that could become irksome for companies that are into mining. Similarly, the states would suffer if prices fluctuate if royalty is based on ad-valorem.

Chief secretary of Chhattisgarh Shivraj Singh said they would welcome if this suggestion is accepted by the Centre.

Of the three states, only Orissa takes five per cent of the company's profits for development of the local mining area. Orissa mines secretary L.N. Gupta and his Jharkhand counterpart Jai Shanker Tiwari were of the view that such suggestions are feasible for implementation.

Gupta went further demanding that till royalty issue is resolved, the Centre should make for interim arrangements so that the states do not continue to suffer financially. All these three states have been demanding at least 20 per cent royalty on sale price of coal instead of the present royalty based on tonnage.

Mines ministry plays Naxal card

RISHI RAJ, Financkial Express

14th April 2007

NEW DELHI, APR 13: The ministry of mines has written to the finance ministry, seeking withdrawal of the Rs 300-a-tonne duty on iron ore exports levied in Budget 2007. The ministry said this duty would lead to job losses in iron ore-rich states and thereby heighten Naxalite activities. Jharkhand, Chhattisgarh, Orissa, Karanataka and Goa have among the country's largest iron ore deposits. Describing the levy as premature, the ministry of mines note stated that iron ore-rich states were largely under-developed and had large forest reserves and tribal populations. Agriculture had limited possibilities and there was little scope for manufacturing due to poor infrastructure.

The ministry has argued that the export duty would erode Indian iron ore's competitive edge vis-à-vis Australia and Brazil, as prices would shoot up by $7-8 a tonne. This would cause additional unemployment of about 5-6 lakh people in these "backward states". Hence, Naxalite activities would gather momentum and could be difficult to contain, it warned

"It need not be over-emphasised that the mainstay of these backward states is mining activity and the move to tax will have an adverse impact on the employment potential in these areas," the ministry said.

Mines ministry plays Naxal card

NEW DELHI, Financial Express

13th April 2007

The ministry of mines has written to the finance ministry, seeking withdrawal of the Rs 300-a-tonne duty on iron ore exports levied in Budget 2007. The ministry said this duty would lead to job losses in iron ore-rich states and thereby heighten Naxalite activities. Jharkhand, Chhattisgarh, Orissa, Karanataka and Goa have among the country's largest iron ore deposits.

Describing the levy as premature, the ministry of mines note stated that iron ore-rich states were largely under-developed and had large forest reserves and tribal populations. Agriculture had limited possibilities and there was little scope for manufacturing due to poor infrastructure.

The ministry has argued that the export duty would erode Indian iron ore's competitive edge vis-à-vis Australia and Brazil, as prices would shoot up by $7-8 a tonne. This would cause additional unemployment of about 5-6 lakh people in these "backward states". Hence, Naxalite activities would gather momentum and could be difficult to contain, it warned

"It need not be over-emphasised that the mainstay of these backward states is mining activity and the move to tax will have an adverse impact on the employment potential in these areas," the ministry said.


No steps yet to scrap Phulbari coal field deal: Finance adviser advises Tapan to take up Asia Energy issue with CA

Aminul Islam, NewAge

14th April 2007

The finance adviser, Mirza Azizul Islam, has advised the energy adviser, Tapan Chowdhury, to discuss the Asia Energy's investment issue 'informally' with the chief adviser or the council of advisers, sources in the finance and planning ministry said.

They said Mirza Azizul forwarded to Tapan a letter of the Asia Energy that pointed out what 'benefits' the Phulbari coal field would give to Bangladesh and how 'energy security' would be protected.

On the letter of the company, Mirza Aziz wrote a note on April 7 that said if the energy adviser wished he could go through the letter and discuss informally the issues [content of the letter] with the chief adviser or the council of advisers.

The Asia Energy sent the letter to the finance adviser after the company executives had called on the adviser in March.

The company has been claiming that Bangladesh will get direct benefits worth $7 billion for 30 years from the controversial Phulbari coal project although energy experts and environmentalists have given a warning that the proposed open-pit mining would bring about environmental disaster in the locality.

When contacted, Tapan told New Age on Tuesday the finance adviser had just forwarded the letter. 'He [finance adviser] did not make any suggestion or directive. It is a normal procedure that he forwarded the letter.'

When asked whether he would take up the issue with the chief adviser or the council of advisers, Tapan said, 'The Asia Energy issue will not be discussed separately. If the foreign investment issue comes up for discussion [with the CA] the Asia Energy issue might be discussed.'

The government, meanwhile, has not taken any steps to implement the agreement the Rajshahi mayor, Mizanur Rahman, signed on behalf of the government with the protesters at Phulbari on scrapping the deal with the Asia Energy on Phulbari coal field.

The agreement was signed following the killing of three protesters who demonstrated against the coal project by the law enforcers.

The Prime Minister's Office during the BNP-led four-party government asked the Energy and Mineral Resources Division on September 29, 2006 to take 'necessary steps' to scrap the agreement with the UK-based Asia Energy on Phulbari coalfield in Dinajpur.

The PMO move came one month after the Rajshahi mayor, Miznur Rahman, signed an agreement with the protesters at Phulbari for the cancellation of the contract with the Asia Energy and expulsion of the company from Bangladesh.

The PMO order, signed by a director, Shafiur Rahman, directed the division to 'take necessary steps to implement the agreement that

Mizanur Rahman signed on behalf of the government with demonstrators on August 30 [2006].'

The division then asked for the law ministry's opinion on the issue, but is yet to get any response from the ministry in six months.

When contacted, the energy secretary, AMM Nasir Uddin, told New Age on Wednesday, 'We are still waiting for the law ministry's opinion on the issue as it is totally a legal issue.'

He, however, could not confirm when the law ministry would give its opinion. 'It is a sensitive issue [cancellation of a deal with a foreign company]. So it is natural that the law ministry will take time to look into the pros and cons and give its opinion. It is, however, entirely up to the law ministry when it will give its opinion,' he said.

A expert committee formed by the government has already found the deal with Asia Energy illegal and that the Phulbari coal project would bring about environmental disaster if the open-pit mining is followed there.


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