Bhubaneshwar: How serious is the Odisha government about the mega steel plant proposed to be set up by Korean major Posco near the port town of Paradip?

On the face of it, it appears dead serious, if the elaborate arrangements it had put in place for the latest round of land acquisition that began on 3 February is anything to go by. Close to 400 policemen were pressed into service for the betel vine demolition operation that started on a Sunday. More than the size of the police force, it was the surreptitious nature of the start of the operation — with police swooping down on Gobindpur village even before the clock had struck 4 in the morning — that suggested that the Naveen Patnaik government’s was really keen to see the long-delayed project through.

In a move clearly designed to send out the right signal to the Korean steel major, Vishal Dev, chairman-cum-managing director (CMD) of Industrial Infrastructure Development Corporation of Odisha (IDCO), the government agency tasked with land acquisition for the project, dashed off to the Posco site on Wednesday and assured that land acquisition, halted since last week in the face of stiff opposition by the villagers of Gobindpur, would ‘resume soon’.

But a sequential analysis of events since the signing of the memorandum of understanding (MoU) for the 12 million ton per annum (MTPA) port-based plant, billed as the biggest ever foreign direct investment (FDI) project in the country, on 22 June, 2005 suggests that while it may have been a top priority at one time, the government’s determination to see the project through has tapered off in recent years.

“It has been a case of running with the hare and hunting with the hounds,” points out an industry watcher. “Consider this. The first thing that any government keen on the project would have done is to renew the MoU, which lapsed way back on 21 June, 2010. The next priority should have been to expedite the environmental clearance suspended by the National Green Tribunal (NGT) in March last year. But instead, the government is going ahead with land acquisition — a classic case of putting the cart before the horse,” he says.

Even if the state government does manage to acquire and hand over to Posco the 2, 700 acres of land which the company says is the minimum it needs, there is no way it can start work on the project in the absence of an environmental clearance, points out a senior official of the Industries department. “One must remember that it was precisely on this ground, starting work before getting the EC, that the Union Ministry of Environment and Forests (MoEF) rejected the expansion plan of the Vedanta refinery at Lanjigarh in Kalahandi district from 1 MTPA to 6 MTPA,” he says describing the current round of land acquisition ‘patently illegal’.

Surely, the Naveen government cannot be unaware of this reality. But it has to maintain the pretence nonetheless to convince Posco and the Central Government about its sincerity of purpose. Already there are reports of activists led by Prafulla Samantara, whose petition in the NGT led to the cancellation of the conditional EC granted to the project by the MoEF on 31 January, 2011, exploring possibilities of filing a contempt notice against the state government for going ahead with land acquisition even in the absence of a MoU, EC, raw material linkage and so on. [The Naveen government must be secretly hoping that Samantara and Co would go ahead with the petition and obtain a stay on the land acquisition so that it does not have to keep up the pretence much longer!]

But why on earth, one may ask, would the Naveen Patnaik not want the project to go ahead in the first place? For one thing, assembly elections in the state are just about a year away and acquiring land, which perforce would involve use of force given the history of the anti-Posco agitation so far, is the last thing that a government seeking an unprecedented fourth successive term would want. “After all, the Posco project would not bring votes for the BJD. If anything, any use of force at this stage would further alienate the people, not just in Paradip but elsewhere as well,” says a cabinet minister in the Naveen government.

For another, the BJD government already has a lot to defend against — distress sale of paddy, the massive mining and coal scams, the alarming rise in crimes against women and so on — and would be loath to giving a handle to a rejuvenated Opposition to beat itself with during the long budget session of the state Assembly which started on Thursday.

While the Naveen Patnaik government was certainly keen — in fact very keen — about the Rs 52, 000 crore project in the initial stages, it has belatedly realised that it would not yield much for it by way of political dividend. It has already been embarrassed enough for agreeing to set up such a mega project in a highly fertile and agriculturally prosperous area in the first place and then reducing the all-important public hearing process to a mere farce. Having burnt its fingers twice over – first with the 6 MTPA Tata steel plant at Kalinganagar where 13 tribals were killed in police firing in January 2006 and then again with the aluminium refinery project of Vedanta which has shut down since 5 December, 2012 for want of bauxite — the government is now wary of doing anything that could affect its pro-people image.

There is a third reason for the government’s diffidence about backing the Posco project which is never discussed publicly: the financial spin-off — or the absence of it, to be more precise — from it. It is the worst kept secret of the 13-year long rule of Naveen that Vedanta funded a large chunk of the funds spent by the ruling party in the 2004 elections. But for obvious reasons, no such largesse can be expected from a multinational company like Posco. “If Naveen can wash his hands of Vedanta after all that the company has done for him and his party, he can hardly be expected to go the whole hog for Posco, can he?” asks somebody familiar with the goings-on in the power corridors.