INDIA: Korea's Poscao says massive steel plant on track
Updated
In India work is set to begin on a controversial steel plant that is worth 18,000 jobs but has faced strong local opposition. South Korea's Posco Steel company plans to invest $12 billion in the development in the eastern state of Orissa making it the biggest foreign investment deal yet in India.
SNOWDON: The world's third largest steel maker Posco signed an agreement with the government of Orissa back in June 2005.
It approved the building of a giant steel plant with a final production capacity of 12 million tonnes a year on the coast of the eastern state.
Such a large project requires land totalling about 4,000 acres, a captive or dedicated port and a mining lease for the provision of raw materials like iron ore.
Posco has been promised more than 3,000 acres of government land.
It's bought only 200 acres of the rest it needs and faces competiton from 40 other companies for mining leases in the area.
On top of that protests have dogged the project.
Posco India spokesman, Shashanka Pattnaik, says most opposition has subsided and preliminary work is set to begin as soon as next month, for the first stage of construction to be on schedule for next year.
PATTNAIK: More than 90 per cent of the land is government land and only four 38 acres of the land is for private land. So therefore we don't foresee any problems as whether land acquisition is concerned. And it is in no way affecting our stage one of the construction work.
SNOWDON: At times the protests have been violent and at one stage involved the kidnapping of Posco staff by local villagers who claimed they would lose their land and their livelihoods.
Posco's Shashanka Pattnaik says the company has worked at better informing the local communities and two of the three affected districts are now on side.
PATTNAIK: Last week our CMD, Mr Soung-Sik Cho paid a visit to the site and there was a tremendous response over there and the people supported this project wholeheartedly, and also 50 families in the local area of the troubled district have already given their support to this project, they've given the land of the project. So we are very hopeful that everything will fall into place very soon.
SNOWDON: Of the 18,000 promised jobs over the next decade, Posco says 97 per cent will go to Indian employees and as many as possible will be locals.
And it acknowledges it's learnt some lessons on community relations along the way.
Shashanka Pattnaik again:
PATTNAIK: Any mega project of this magnitude will have its own share of problems, but we are happy to tell you that compared to all mega projects in the country, this project is moving very rapidly, and also the company is in the process of developing sustainable livelihood package, which will benefit the local population.
SNOWDON: And why India? I know Posco is developing plants elsewhere and Vietnam has some interest for the company. Why India for this size of operation?
PATTNAIK: As you know India first of all is gifted with natural mineral resources ... there is the land and also in India you get quality human resource.
Presenter: Karon Snowdon
Speakers: Posco-India spokesman, Shashanka Pattnaik
