Bend It Like Moily
Seven reasons why UPA’s pre-poll green clearance for Posco is more about spiel than steel
On the face of it, a government in its dying days has served up a much-needed self-image booster—a decision showcasing decisiveness, speed and with high symbolism. In giving the green clearance to India’s biggest foreign direct investment (FDI) proposal by South Korean steel major Posco, the UPA government is on target in sending the right signal to global investors (rightfully) seeking more promise in India. Of course, it’s also wonderfully timed as the nod for Posco came days before South Korean President Park Geun-hye came visiting on January 15.
It was preceded, of course, by a few deft chess moves—in late December environment minister Jayanthi Natarajan was shown the door and replaced by Veerappa Moily (who now holds the unique distinction of being energy and environment minister at the same time). Congress vice-president Rahul Gandhi simultaneously made all the right noises about driving trucks through loopholes. And a flurry of environmental clearances—70 at last count, though the ministry website is not being updated that regularly now—paved the way for the clearance of Posco’s steel plant. The government collected its fair share of hosannas in the national media (though the local media in Orissa has been strangely muted).
Obviously, there’s a big problem here—and (this must be stated upfront) it’s got nothing to do with FDI. Many environmental and rehabilitation concerns have been raised about this massive project. By all indications, they have been swept under the carpet—or left for the courts and the future government to decide. For instance, the environment nod for Posco’s steel plant is useless without a forest clearance, which the Orissa government still needs to provide. Also, the project has been conveniently cleared by delinking it—the clearance given only to the steel plant, not to the integrated project that also envisages a port and an iron ore mining proposal.
But even in opening the door for Posco’s steel plant, has the government overlooked the people’s concerns raised by green tribunals and at least four committees? There are serious agitations on the ground as we speak (see following article). It does not appear that these problems will disappear overnight. Does this nod not smack of a charade by the UPA government to show its investor-friendly credentials? Official sources agree that till the replacement of Jayanthi Natarajan, there was no talk of clearing the Posco steel project. “Just for creating some goodwill it has been cleared. There is also the question of perception and credibility of India as an investment destination,” they say.
But why would the UPA allow the open maligning of Jayanthi, a loyal party worker by all accounts? Or is there some truth to the ‘Jayanthi tax’ statement Narendra Modi made after her removal? In her own defence, Jayanthi told Outlook, “My mandate was to prevent the destruction of the environment. I do not see the environment ministry as a clearance house, therefore I needed to study every project for impact assessment.” On Moily, Jayanthi comes up with a politically correct response, stating that he is a “very seasoned politician. I am sure he will take the right decision in the interest of the country.”
Burning ambition A Dhinkia gram panchayat demonstration. (Photograph by Sanjib Mukherjee)
Modi, of course, has an axe to grind. The farmers of Orissa can take heart from the success of their brethren in Navinal village of Gujarat who earlier this month won a favourable verdict from the Gujarat High Court for their plea against the Modi government giving away their cattle grazing land to the Adani Ports and Special Economic Zone Ltd (APSEZ) project at Mundra in Kutch district. The court observed that the Adani SEZ had started operations without getting necessary environment clearances, a development that led Modi to charge that Jayanthi had been deliberately delaying clearance to collect the ‘Jayanthi tax’.
The reports of files (around 300) having been kept pending by Jayanthi has added to the usual whispers about a pre-election funds collection for the party. As of now, it remains unclear why she was sitting on the files. The official reason was that she was creating ‘environment bottlenecks’ in project implementation. This was reinforced by PMO sources stating that the former minister was perceived to be “generally slow. Given the situation (slowdown in economic growth and investment inflow), it was not very encouraging”. There is, however, acknowledgement that Jayanthi had “several complicated issues” to look into and resolve, including the case of Posco.
It’s also no secret that there has been a consistent push by the PMO over the last eight years to get the Posco project cleared. “There have been clear letters written from the prime minister’s office back in 2010 and also in 2007 when the first clearances were granted. This was also one of the submissions during the green tribunal arguments back in 2011-2012,” says Kanchi Kohli of the environmental NGO Kalpavriksha.
On the other hand, questions are being raised on the undue haste Moily has shown in clearing over 70 files within just three weeks of taking charge. Has the environment ministry become the single-point reform and clearing house for projects in the few months’ window before the elections? While Moily’s jet-speed decision-making—whether yes or no—is raising investor perception, it has made many, apart from the green lobby, very jittery.
“It is ridiculous to push through statutory clearances to please foreign dignitaries!” says former power secretary E.A.S. Sarma. “As in the case of Posco, this happened in the case of Jaitapur. Imagine, foreign governments saying, ‘Don’t worry about the environment clearance under the Environment (Protection) Act for our project. We will arrange our PM’s visit and India will cave in.’ This makes India a veritable banana republic.”
There are other issues being raised about Moily’s clearance for Posco. “By clearing Posco’s steel project in isolation, he has brazenly violated the spirit underlying the National Green Tribunal’s order of March 2012,” argues Sarma. The ngt advised the MoEF to issue “clear guidelines for project developers that they need to apply for a single EC (environment clearance) if it involves components that are essential part to the main industry”, steel in this case.
Setting the limit Posco builds a boundary wall. (Photograph by Raj Chaudhury)
A sensible response to the tribunal’s order would have been to appraise the steel and the port projects together and study their cumulative impact on the people and environment. Unfortunately, in the eight years since the South Korean steel major started the process of acquiring land and getting the necessary clearances and licences, it has failed to meet many of the prerequisites as per law. Chief among them is the impact assessment of the total 12 million tonne steel plant. MoEF officials say the assessment submitted by Posco pertains only to four mt capacity.
Apart from finding a clear case of a violation of the Forest Rights Act, Saxena—who headed a panel in 2010 to study such fra violations by Posco—finds it incomprehensible that the government has made no attempt in the last several years to prepare the families for relocation and employment as the locals are ill-equipped and face the disadvantage of not knowing even Oriya. That’s why the on-ground agitation shows no signs of petering off.
Drawing similarities with the Vedanta project which has been denied mining clearance in the Niyamgiri hills by Moily, Tushar Dash of Orissa-based NGO Vasundhara states that while both the projects are set to affect large population of tribals, it is the Supreme Court intervention that has protected the rights of Niyamgiri tribals. “In the case of Posco, the procedure of recognising and identification of the rights of the people and getting their informed consent through gram sabhas before the clearance process has not been carried out,” says Dash. He fears that after the approval for the steel plant, the port and mining proposal may also be cleared.
Kohli of Kalpavriksha hopes that it won’t be such a fait accompli as even after the delinking, “Posco can’t go ahead with the construction on the ground as another case is pending before the green tribunal from where it is clear that the Section 2 order for forest diversion has not been issued by the state government.” The environmental activist reveals that the Orissa government has just two days back recommended to the Centre that the Khandadhar mine be given in favour of Posco to source iron ore. However, we are far from environment clearance process there as well.
With many more clearances still awaited and the issues of agitating people still unresolved, there is a wait on the side of both Posco and the government to hasten the $12 bn project. It is not as yet clear whether Posco will move ahead with the construction of the steel plant sans the mine and port project clearance. “This is not the final clearance for the project. Even now the forest clearance is under challenge before the National Green Tribunal, which has stopped it from felling any trees. This has been on since April last year. The next hearing is on January 21,” says Ritwick Dutta, an environmental lawyer.
Dutta points that the government decision of giving the steel plant a go-ahead is flawed as without the captive mine, it does not make sense for Posco to set up a mega plant in Orissa with the current supplies of iron ore produced in the state being committed. Moreover, procuring iron ore on commercial terms may mean paying four to five times more for raw input.
But try telling that to a government hell-bent on symbolism. Ahead of former French president Nicolas Sarkozy’s visit to India in December 2010, the environment ministry (under Jairam Ramesh) had similarly given its go-ahead—albeit with 35 conditions and safeguards—to the Jaitapur nuclear power project in Ratnagiri, Maharashtra, even before the MoU was signed. Jairam Ramesh, the then environment minister, had said, “Economic growth, fuel mix diversification, global diplomacy and environmental protection were the key objectives while giving the go-ahead.” As the French put it so well, plus ca change, plus c’est la meme chose.
It’s distressing to learn that environment clearances are being given to please foreign dignitaries or to placate big business in an election year (Shove Comes to Push, Jan 27). The environment ministry must decide on project clearance within a fixed time limit and upload on its website the relevant documentation on how the decision was arrived at. A whimsical and procrastinating approach can neither be good for the environment or for the nation’s development.
Arbab Kausar, Agra
It’s an irony that an investor-friendly UPA has to turn environmentally hostile to placate the trimurtis of the capitalist world—the World Bank, the International Monetary Fund and the World Trade Organisation.
C. Chandrasekaran, Madurai
Political irresolution and cussedness over the tenures of two consecutive environment ministers have held FDI in this country to ransom. The ministry under Veerappa Moily should use the few months left before it to speed up clearances. As the minister is himself discovering, several of the projects need nothing more than his signature.
J. Akshobhya, Mysore
The government’s desperation to improve its political image at the last minute is all too apparent. It cares two hoots about the environment or the people, it is only concerned about the (remote) possibility of currying favour.
Lt Col Ranjit Sinha, Calcutta
Time and a globalised world do not stand still. If the formalities and paperwork stretch over a decade, the project will go elsewhere. Or, in the intervening period, the economics of the industry might change beyond recognition. We must find a more viable balance between economic development and protecting the environment. As for hoping that development and human rights reinforce each other as Smita Narula of ihrc says in an accompanying interview, the new land acquisition act has generous provisions for land price, annuities, jobs. Local communities cannot exercise a veto over development.
Ashok Lal, Mumbai
Any decision on a project should be taken fast, whether in approval or otherwise. It’s the dilly-dallying which is more harmful for all the interests concerned.
P.B. Joshipura, Suffolk, US
The million-dollar question is how much ore they are going to process in India and how much they’ll take home? Simply digging and transporting ore will not get much in terms of royalty, tax or employment.
Kishore Dasmunshi, Calcutta
Natural resources must not be given away to private companies in general and to foreigners in particular. The government should develop them after analysing all issues, including the rights of forest people. Efficiency does not matter as much as fairness to all parties. A government monopoly is best for handling natural resources.
Parthasarthy Shakkottai, on e-mail
The UPA evidently wants to blanket a decade of goof-ups by giving a green clearance to Posco. If Manmohan and team think that they will get brownie points for this and get into the good books of the aam aadmi before the elections, they are seriously mistaken.
K. Chidanand Kumar, Bangalore
Too little, too late. What’s the point of waking up now?
Dinesh Kumar, Chandigarh
Sell iron ore at Rs 1,500 per tonne and buy processed steel at Rs 25,000 per tonne. The least you can do is not kill the environment in the bargain.
Rajesh Chary, Mumbai
For once, a balanced view in the media on the Posco issue (UPA’s Stainless Steal?, Jan 27). It doesn't take an Einstein to realise that a healthy environment is essential for a healthy population, that forests are the key to water and food security—and growth. It’s another matter altogether that over 90 per cent projects where forests are an issue get the green nod nowadays. It needs reminding that the MOEF is there to conserve forests and environment, not facilitate clearances.
Prerna Singh Bindra, Member, State Board for Wildlife, Uttarakhand
The number of environmental clearances given in the last decade indicate that steel is a much malleable thing in the hands of the UPA.
A.S. Raj, Arcot
It is an irony that investor-frinendly UPA turns environment hostile, for retaining the tag of votaries of reforms. Ostensibly UPA is irresistible to thrimurthies WTO,IMF, and WB who pull the strings for MNCs to wholly exploit the flora and fauna of India, thus vacating the tribals from out of their place.Though the second wicket Jeyanthi is declared out now, she is hailed for her forthrightness in keeping Posco at bay all along.Mani Shankara Iyer, the odd man out in Congress camp, who was the first wicket, was run out by MNC Oil Cos,when the former stood a stumbling block for fuel price hike. We do not know when UPA will attempt a hat trick through similar pink slip to Jeyaram Ramesh whom the party concieves a thorn in flesh. BJP is no different as the story of Gujarat goes to say. Tamil Poet Bharathi will be turning in his grave, for his vision getting ignored." Naamirukkum naadu namathendru arinthom, namakke uriyathaam endru arinthom"
Too little, too late. What's the point of waking up now?
4/D-21, Certainly the tribal girl should aspire to improve her life and the government and citizens need to support her and others like her in achieving it. However, look at what mining does - it will destroy the environment and leave a gaping hole in the earth. The government will kick out the tribals - who at this stage know no better than to lead a tribal way of life. They will get a few lakhs which they will not know how to use, and will be quickly dissipated. They will evetually wash up on the shores of big cities and indulge in begging, prostituiton, stealing etc. for no one will give them anything better to do. Thats about the people; the flora and fauna dont have voices, they'll be gone. Forests first!
India has some of the most beautiful forests, rivers, mountains. Dont mine Niyamgiri. No amount of money will make up the devastation it will cause. Flora, fauna cant defend themselves, they dont have votes - we the citizens are the custodians of this earth, lets defend it. Sure, we'll earn a little less, our GDP will be a bit lower, but there are other means to make up for it. Dont destroy our forests, our rivers.
Million Dollar question is how much of ore they are going to process in India and how much they will take home? Simply digging and transporting ore will not get much in terms of royalty, tax or emploment!
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