October 21, 2010 : The POSCO mirage fades

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A report by an Indian government panel has recommended that environmental clearances for POSCO's construction of a steel plant in the Jagatsinghpur district in the north-western state of Orissa, India, be cancelled. After an investigation, three of the four members of the Environment Ministry panel concluded that the South Korean steel giant's project is "an example of how a mirage of 'development' can be used in an attempt to bypass the law." Such attempts, they added, "result in neither development nor environmental protection, but merely in profiteering."

Another report, produced by the fourth committee member, Ms Meena Gupta, contrasted sharply with the conclusions of the other three members, arguing that the clearances should not be cancelled. According to the Times of India, the United Progressive Alliance Government of India may be, "inclined to clear the project, relying on the dissent note."

Local residents in the area of the proposed plant had refused to move to make way for the project, as the land grab would inevitably cause immeasurable harm to the nation, to the rule of law and justice and to the environment, including widespread water shortages. POSCO has been trying to build the steel plant since 2005 but has been stopped by local resistance ever since.

The company entered Orissa with other multinational mining companies after the state was opened up to mining companies in the Industrial Policy of 2001, co-written by the UK's Department for International Development (DFID) as part of liberalising reforms pushed by the World Bank and the DFID, as described in Corporate Watch's Dodgy Development series. This follows an Indian government ruling against the UK-based Vedanta for violating forest conservation, tribal rights and environmental protection laws, again following a sustained campaign by people refusing to move from their land.

In a statement, the Posco Pratirodh Sangram Samiti, representing people living in the area, said: "Those who keep talking of the POSCO project as one of 'national importance' should answer these questions: Would any other country in the world tolerate such violations of their law? Would South Korea tolerate an Indian company grabbing their land, breaking their laws and threatening to cause an environmental disaster? Is this what development means – robbing thousands of their lands and threatening lakhs [hundreds of thousands] with water shortage and other catastrophes?"