___________

The above is a good idea.

• A plan over a larger area will avoid congestion and slums that are typical of densly packed areas.
• Another big benefit will be that the term "Capital Area" will make it easier for institutions, companies and other entities to come to the gretaer area rather than coming to "Bhubaneswar". For example, many institutions that are looking for land in Bhubaneswar are hesitant to locate in Kendrapada or Jagatsinghpur; even though the political leadership is very welcoming.  But once the term "Capital Area" encompasses Kendrapada and Jagatsinghpur, these institutions will be less hesitant to come there.

So while the current Bhubaneswar and Cuttack planned areas will sever as the core urban area, the larger Capital Area development region will morph to a sub-urban area which down the road will touch the metropolitan areas around Angul in the west and Berhampur in the south.

We wrote about this in http://www.orissalinks.com/orissagrowth/archives/3637.

A similar term needs to be coined for the greater Sambalpur-Jharsuguda-Rourkela area. See http://www.orissalinks.com/orissagrowth/archives/3660 , http://www.orissalinks.com/orissagrowth/archives/3672 and http://www.orissalinks.com/orissagrowth/archives/3668.

Perhaps it can be called the "Western Odisha Development Region".

(Thanks to a reader for the pointer.)

Following is from a report in Telegraph.

The Memorandum of Agreement (MoA) for setting up the Rs 2.7 lakh crore petroleum, chemicals and petrochemicals investment region (PCPIR) near Paradip was signed between the state and the Centre today.

The PCPIR will come up over 284.15sqkm in Jagatsinghpur and Kendrapara districts with a proposed investment of Rs 2,77,734 crore.

While Orissa Industrial Infrastructure Development Corporation (Idco) chairman-cum managing director Priyabrata Patnaik represented the state, additional secretary of the department of chemical and petrochemicals Geeta Menon signed on behalf of the Union government. Patnaik said, “The MoA was signed and the project has got legal sanction. All the work for the project will now proceed according to the plan.”

… Sources said the state government has requested the Centre to take up the project work in the 12th five year plan. Under the plan, an airport will come up at Paradip and two direct roads from Bhubaneswar to Puri Paradeep will be built. One of these will begin from Uttara Square on the outskirts of Bhubaneswar.

Idco will act as a nodal department to help the government develop the PCPIR. “A meeting chaired by CM Naveen Patnaik is likely to be held this week to finalise the detailed project report.”

An apex body under the chairmanship of the chief minister has already been constituted to look into the implementation of the project. Under the proposed plan, a regional development authority (RDA) will be set up. The RDA will have autonomous power and other authorities will not be able to intervene in the work of the RDA.

… Officials hope that land acquisition for the project would not be a problem. “Instead of taking lands directly from people, we will go for swapping of land. If the government takes one acre of land, the same area of land will be allotted to the owner in another place,” said an official associated with the project.

Sources said the government had asked the Centre to build a coastal corridor that would connect Paradip to Chennai. “Andhra Pradesh has also supported Orissa. The Centre has taken the demand seriously,” said the official.

The Indian Oil Corporation (IOCL) will be the anchor tenant for the project. The PCPIR will also include the IOCL’s refinery at Paradip, which in the first phase, will have an investment of Rs 29,777 crore. The refinery will have a crude and vacuum distillation unit, a hydro-cracking unit and a delayed coker unit. It will also have an integrated gasification combined cycle plant for production of steam, power and hydrogen from petroleum coke for captive use in the refinery.

Another leading player, Deepak Fertilizers, will set up a greenfield ammonium nitrate plant in the PCPIR. Tata Steel and the South Africa-based Sasol have expressed interest in setting up a coal to liquid project under the PCPIR. The project is likely to come up by 2018 in an area of 3,000 acres. The plant will produce 80,000 barrels of liquid fuel from coal per day.

According to the plan, Rs 13,634 crore will be invested for infrastructure development in the PCPIR. Of this, the Centre will provide Rs 716 crore under Viability Gap Funding (VGF) to ensure infrastructure linkages such as rail, road (national highways), ports, airports and telecom through public-private partnership. The state’s share will be Rs 1,796 crore while the remaining Rs 11,122 crore will be generated through private participation.

Following is from a report in Telegraph.

The capital will soon have a mega-tourist circuit for which the Centre has sanctioned Rs 8.14 crore.

The proposed tourist circuit envisages, among others things, renovation of two major roads in Old Town area, construction of a ‘parikrama’ around Lingaraj temple, soft-lighting for eight protected monuments and two tourism interpretation centres.

While the tourism department is trying to revive Ekamreswar, the miniature temple of Lord Lingaraj near Lingaraj police station, a dedicated road corridor will be constructed to link Puri, the Old Town area and Khandagiri via Dhauli.

Moreover, a 3,000-seater amphitheatre will be constructed opposite Madhusudan Park at Pokhariput.

… Samal spoke to reporters after the heritage walk, which was held today as part of World Tourism Day function.

The circuit will aim at facilitating various cultures as the city is perhaps the only one place in the region where three major religions — Hinduism, Jainism and Buddhism — have their presence and the Daya riverbed is linked to the transformation of Emperor Ashok from Chandashok to Dharmashok.

… While the mega circuit will be part of the development of the ambitious Bhubaneswar-Puri-Chilika tourism sector, the Old Town area of the city will have a 40-feet road near the temple connecting Kotitirtheswar Lane and a proposed three-acre parking site.

Later, the same road will be extended up to Kedar Gouri temple. These two roads, in turn, will provide a better corridor so that tourist vehicles can pass through the areas smoothly. Similarly, a ‘parikrama’ or circular road will be planned around the Lingaraj temple.

“Apart from providing better connectivity to the Old Town area, the side walls of various buildings and structures will be decorated with tiles of red laterite stones. The concept has already been adopted in various western cities and states such as Rajasthan. …

The mega circuit will also emphasise on infrastructure development to connect various sites of Buddhist and Jain religious interests. Other than central assistance, there is also a plan to develop a road connecting Gangua nullah (through its right embankment) to the historical Kapileswar village. Another road will link Ganesh Ghat near Dhauli Peace Pagoda with the Jatni Kapilaprasad Road.

According to the pre-feasibility report, the state government will spend more than Rs 30 crore on the two proposed roads.

“These two roads will connect Dhauli with Khandagiri and the travellers and tour operators need not take the longer Cuttack-Puri Road via Rasulgarh to reach the historical Jain sites. Even nature lovers visiting places such as Deras in Chandaka or Nandankanan Zoological Park can take this road in future,’’ said the MLA.

“The state government has also asked the Bhubaneswar Development Authority to construct an amphitheatre opposite Madhusudan Park in Pokhariput. This will resemble the amphitheatre at the Utkal Sangeet Mahavidyalaya near Rabindra Mandap,’’ he said.

Sources at the public works department said: “There is a plan to construct a flyover over the railway level crossing at Pokhariput for Rs 42 crore. While the state government will share Rs 22 crore, the rest will come from the railways. Once the flyover is commissioned, the road from Dhauli to Khandagiri will become a vital link to various religious centre.’’

Under the mega tourism circuit, temples such as Lingaraj, Rajarani, Mukteswar, Rameswar, Parsurameswar, Lakshmaneswar, Bharateswar and Satrughneswar will be illuminated with light emitting diode based ‘dynamic lighting system’ for which Rs 3.98 crore will be utilised. The project will be executed by the Orissa Tourism Development Corporation.

Hinting at the development of two interpretation centres near the Lingaraj temple, Samal said: “While one will be constructed on the premises of Sibatirtha Mutt, the other one will come up near the employees’ colony.’’

On the proposed tourist interpretation centre near Khandagiri-Udaygiri caves, he said the project would be completed within two or three months time.

Following is from a report in Business Standard.

The Orissa government has decided to promote heritage tourism at eight locations along the coast line with an investment of Rs 7.41 crore in the next five years.

Based on archeological, architectural, sculptural and historical importance, the selected structures, identified by the state archeology department, would be taken up under the World Bank funded Rs 227.64-crore Integrated Coastal Zone Management Project.

… The structures identified to get a face lift under the scheme included Potagarh (Buried Fort), located on the bank of river Rushikulya in Ganjam town which stands as a mute witness to the vicissitudes of history in Orissa.

Apart from historic Potagarh, the British Cemetery near Ganjam town, Bhaba Kundaleswar temple of Manikapatna, Baliharichandi temple near Puri, Hariharadeva temple, Nairi, Bateswara temple, Kantiagada (Ganjam), Jagannath temple, Pentha and Jamboo Colonial Building, Kendrapara will be refurbished under the scheme.

Preservation of ancient monuments under the project will include their protection, structural conservation, chemical conservation, landscaping and maintainance from time to time.

… The officials of the Gujarat and West Bengal projects along with a World Bank team visited various places including Ganjam and Kendrapada districts in the state recently to review the implementation of the project. Project Director of ICZM (Orissa) AK Pattnaik briefed the team about various steps taken under the project and their progress. The scheme, whose tenure spans from 2010 to 2015, is being implemented in two coastal stretches: Paradeep to Dhamara and Gopalpur to Chilika.

Following is an excerpt from a report in Telegraph.

The state government is planning to set up a port-based cluster of wood-based industries in Paradip on the Kandla model. The hub will manufacture wooden products with imported timber and market them within and outside the country.

“The entrepreneurs will set up their units with their own funds. We will facilitate the project by providing land and other infrastructure. The state run Industrial Development Corporation has earmarked 100 acres of land for the purpose,” said industries minister Raghunath Mohanty.

“The beauty of the project is that the wood-based units will use timber imported from South Africa, New Zealand and West Indies. The proposal is on the lines of Kandla project in Gujarat where several wood-based industries are operating. The entire raw material is imported from outside,” said forest and environment minister Debi Prasad Mishra.

Following is an excerpt from a report in ibnlive.com.

The single window committee (SWC) on Friday approved proposals for four industrial units, two of them power plants, with an investment of Rs 1,286.61 crore.

… The proposal of M/S Beverages Private Limited to set up a soft drink beverages unit with capacity of one lakh crates per annum at Atabira in Bargarh district with an investment of Rs 59.61 crore was approved in the meeting.
Similarly, the proposal of M/S Essar Power Orissa Limited to set up 4×30 MW captive power plant in two phases at Paradip with an investment of ` 683 crore was also given the green signal.

It is expected that the project will provide employment opportunity to 200persons.

The proposal submitted by Investa Ventures Limited for setting up a LED manufacturing plant and incubation park at Chandaka near Bhubaneswar with an estimated investment of Rs 190 crore was also approved.

The plant will produce energy saving LED electric bulbs and tubes and is expected to open employment opportunities for 470 persons.

Besides, the proposal of M/S Ultra Tech Cement Ltd for expansion of the existing cement grinding capacity from 1MTPA to 3 MTPA at Jharsuguda Cement Works and bulk terminal in Cuttack district with an investment of ` 354 crore has also got the approval of the committee.

Following is from the Team Orissa newsletter of AprilJune’2011.

In regards to the airport in Paradeep, there has been news that it will be an important aspect of the proposed PCPIR in Paradeep.

In the past, two other airport locations have been mentioned: Koraput/Jeypore/Sunabeda area and Balasore/Baripada/Rasgovindpur area. In fact, after Rourkela, Jharsuguda and Gopalpur, these two will be the important locations as they have the potential to be regional airports.

Following is an excerpt from a report in Financial Express.

New infrastructure projects in Gujarat, Andhra Pradesh, West Bengal, Tamil Nadu and Orissa are set to get a major push in the five years starting 2012 as various government agencies will be prioritising building of roads, rail networks, airports and sea ports in these states that are setting up mega petroleum and petrochemical investment regions.

Five massive regions meant to attract investments in the petrochemical and allied sectors are now at various stages of implementation at Dahej in Gujarat, Visakhapatnam-Kakinada in Andhra Pradesh, Haldia in West Bengal, Paradeep in Orissa and Cuddalore and Nagapattinam in Tamil Nadu. These investment zones, each of which is not less than 250 square kilometres, are expected to attract a collective investment of R8,63,664 crore and create more than 40 lakh jobs during the 12th Five-Year Plan.

… “We will get infrastructure build for these projects using various existing schemes through appropriate prioritization,” K Jose Cyriac, department of chemicals and petrochemicals secretary, said. Government entities like the National Highways Authority of India, shipping ministry and the railways ministry would emphasise on fresh projects in these regions while allocating resources in the coming years. In the case of small connecting roads wherever required, the state governments concerned would include them in their own development plans.

Following is an excerpt from a report in Business Standard.

Petronet LNG Ltd, one of the fastest growing companies in the Indian energy sector has evinced interest in setting up an LNG (Liquified Natural Gas) terminal along the Orissa coast.

Dhamara, Gopalpur and Paradip ports in the state have been identified as the possible locations for the proposed LNG terminal which is set to cost Rs 4,000-5,000 crore.

“Petronet LNG is keen to set up an LNG terminal along the Orissa coast. The company is yet to zero in on any site though Dhamara, Gopalpur and Paradip have emerged as the potential locations. Petronet LNG has told us that the Orissa coast is the most suitable location for setting up the LNG terminal in which Rs 4,000-5,000 crore will be invested,” T Ramachandru, principal secretary (industries), Orissa government told Business Standard.

Petronet LNG is understood to be in talks with Paradeep Port Trust (PPT) authorities as well as promoters of Dhamara Ports Company Ltd (DPCL) and Gopalpur Ports Ltd (GPL) for the project. “We had initial discussions with the officials of Petronet LNG. They have proposed to set up an LNG terminal along the Orissa coast and we are open to the idea of setting up the terminal at Gopalpur. Petronet LNG officials have talked to PPT authorities as well as DPCL,” said Charchit Mishra, director of GPL.

… Petronet runs India’s first LNG receiving and re-gasification terminal at Dahej (Gujarat) having a capacity of 10 million tonne per annum (mtpa), equivalent to 40 mscmd (million standard cubic metres per day) of natural gas. The company is in the process of building another terminal at Kochi (Kerala) which will have a capacity of five mtpa equivalent to 20 mscmd.

Following is from the "About Us" page of Petronet.

Formed as a Joint Venture by the Government of India to import LNG and set up LNG terminals in the country, it involves India’s leading oil and natural gas industry players. Our promoters are GAIL (India) Limited (GAIL), Oil & Natural Gas Corporation Limited (ONGC), Indian Oil Corporation Limited (IOCL) and Bharat Petroleum Corporation Limited (BPCL).

The following map gives an idea that the location picked and being considered by Petronet is not going to be a one-off thing. From the shape of India it becomes clear that many companies who will be importing "things" and distributing them across India would think of three ports: one in the West, one in the South and one in the East. In the East, since Odisha has a much longer coast line than West Bengal, there is a rush to establish ports in Odisha. These ports are going to be a big factor in the development of Odisha. Because of that Odisha is and should be zealously protecting the welfare of its existing and planned ports.

Following is an excerpt from a report in Orissadiary.com.

… Orissa Govt has gone  ahead to make budgetary provisions for providing basic infrastructure to attract the investors to this region. The expenditure requirement was discussed today in a high level meeting held under the Chairmanship of Chief Secretary Bijaya Kumar Patnaik in the Secretariat conference hall.

It has been decided in the meeting that the Project is to  covering 284.15 Sq.Kms. in Jagatsingpur and Kendrapara Districts will be developed in two phases viz. phase-1 covering 195 Sq.kms and phase-11 covering 89 sq. kms. The Project Proposal has been approved by Govt of India. IDCO has been selected as the Nodal Agency and IOCL selected as Anchor Tenant for development of PCPIR. The estimated budget for external infrastructure has been tentatively calculated at Rs.13634 Cr. The entire expenditure has been proposed to be borne jointly by Govt of Odisha, Government of India and Public Private Partnership.

The external infrastructure includes Green Field Coastal Corridor from Astarang to Dhamara via Paradeep ( 140Kms identified under Odisha and Andhra Pradesh PCPIR), Bhubaneswar- Paradeep Corridor(73 Kms.) , other Arterial roads, Port upgradation with new facilities, water supply, Taladanda  & Kendrapara canal lining, Captive Power Plant( 2x500MW) , New sub-stations and feeder lines, rail freight stations along with additional rail sidings, Logistic hubs near Bhutmundei, proposed air port , waste water treatment system and solid waste management. Up gradation of NH-5A ( 78 kms) to 4 lane  and expansion of Cuttack –Paradeep State High Way other important proposed  road projects. The total power requirement has been estimated at 2000 MW.

The demand of water for new projects in region will be 620 MLD  in different phases. Different water treatment systems like CETP & STP have been proposed at each of the chemical parks with estimate of 431 cr. Solid waste management system has been proposed  for disposal  industrial and domestic waste at the estimated cost of 200 Cr. Concerned departments have been directed to take up feasibility assessment and prepare detail project
reports for inclusion in state budget and recommendation to Govt of India for inclusion in 12th  Five Year Plan.

Following is from Dharitri.

Following is from a report in Economic Times.

What’s in it for the locals?

Asit Swain, who lives in Nawagaam, one of the affected panchayats, told ET that the compensation package has been finalised. Farmers will get Rs 11,500 for every decimal (one-tenth of an acre) of betel vine plantations and Rs 18 lakh for every acre where two crops can be grown in a year.

Those growing cashew or farming prawns on government land (without land titles) will get Rs 2 lakh per acre. As for the landless,they will get Rs 2,250 per month till they find employment. They will also get a sum, added Swain, equal to a fifth of what the betel vine cultivators and farmers get.

In addition, two months ago, Industrial Promotion and Investment Corporation of Orissa (Ipicol) recommended a new clause be added to the MoU stipulating that 90% of the unskilled and semiskilled workers, 60% of the skilled workers and 30% of the managerial posts in the project be hired from the local community.

What’s in it for Posco?

Clearly, the project continues to be hugely lucrative for Posco, which is why the company is staying on despite all these delays. The company will get a guaranteed supply of iron ore for at least 30 years, a commodity, whose prices have soared 43% since the beginning of last year.

From recent news that are coming out (see for example,  http://www.business-standard.com/india/news/anti-posco-brigade-hit-hard-by-defectionvillagers/434888/ ) it seems like the POSCO project will now sail through.

With that assumption, I suggest that the government take better care of the people that are being displaced and keeps it focus on the "From mineral resources to Human resources" theme.

To take better care of the displaced people:

(a) the government must have a mechanism to ensure that the compensation paid to the people is not blown away in a year or 2 and the displaced people have nothing to fall back on. Some approaches such as annuity payments for part of the compensation and making the people a shareholder of the plant with specialized shares, which can not be sold immediately, need to be considered. In addition the R & R must include the education of all kids (of displaced people) in decent schools (DAV type), similar to what Vedanta University Project was/is(?) doing in Puri.

To address the "mineral resources to Human resources" goal:

(b) the government must insist that POSCO establish in Odisha a significant branch (or a similar institute) of its top ranked (in research) university POSTECH of S. Korea. This is the least they can and should do for being assured of raw minerals at a low low price.

(c) the government must insist that POSCO establish more of its ancillaries in Odisha itself rather than in other states.

Following is an excerpt from a report in Business Standard.

The State Level Single Window Clearance Authority (SLSWCA) on Monday cleared two projects in the energy sector involving a total investment of Rs 1,045 crore.

The projects which got the nod of the Single Window authority are those proposed by Hyderabad-based Primo Power & Infra Ltd and Konark Kanti Energy Ltd.

Primo Power & Infra Ltd has proposed to set up a 60 MW coal-fired thermal power plant at Gania village in Nayagarh district at a cost of Rs 300 crore. The power plant will create direct employment for 80 people.

"Konark Kanti Energy Ltd will set up 110 MW coal-based power plant at Baghiapara in Boudh district at an investment of Rs 435 crore. This project will generate direct employment for 70 persons. Besides, the company has also proposed to set up a petroleum based downstream industry at Paradip at a cost of Rs 200 crore and a petroleum storage tank at Dhamara at Rs 110 crore", T Ramachandru, principal secretary (industries), Orissa government told reporters after the meeting of SLSWCA chaired by the state Chief Secretary B K Patnaik.

Update 2: The following excerpt from a report in Telegraph elaborates on the point where this may head to the courts.

Giving conditional clearance to the project, the Union environment and forests ministry had yesterday asked the state for an assurance that no one was so entitled. At stake is the final approval for the diversion of 1,253 hectares of forestland for the steel plant and its captive port.

Jagatsinghpur collector Narayan Jena today argued that no one met the criteria under which they could legitimately stake claim to any part of the forestland. This was challenged by the Posco Pratirodh Sangram Samiti, which is resisting the project.

Under the 2006 law, tribals can claim rights over forestland on which they are currently living or dependent for livelihood. According to the state government, no tribal lives in the project area.

However, the 2006 law also allows Other Traditional Forest Dwellers (OTFDs) to claim forest rights provided they satisfy three criteria. The claimants must:

• Have lived on the forestland for 75 years prior to December 13, 2005;

• Have been in occupation of the land before December 13, 2005;

• Be dependent on the forestland for their “bona fide” livelihood needs.

Collector Jena declined comment on the Union ministry’s riders since the official order is yet to be received, but tried to clear the air on the matter of forest rights.

He said the project area had been notified as protected forest area only in 1961 — so technically, no OTFD could claim to have lived in a “forest” there for 75 years. “Had there been tribals in the area, the situation would have been different. But no OTFD can claim such benefits because its forest status does not go back 75 years,” he said.

He conceded that the area was part of Burdwan estate before 1952, when there were reserve forests in Jatadhari and Bhuyanpal, which are part of the project area. But he insisted that the area was completely uninhabited now.

However, the Union tribal ministry says that claimants under the OTFD category do not have to prove they live on the forestland but only that they depend on it for their “bona fide” livelihood needs.

Jena countered this by alleging that claimants to land in the project area were encroachers, implying their claims about dependence for livelihood would be untenable.

Update: Following is from an editorial in Economic Times. I am in agreement with the observations there.

Environment minister Jairam Ramesh has passed the Posco buck, nominally to the government of Orissa but, in reality, to the courts. His final clearance of the project depends on a categorical assertion by the government of Orissa that there are no ‘other traditional forest dwellers’ among those whose land would be diverted for the project. … Now, if the government of Orissa does provide the Centre with the categorical assertion that it has sought on the nature of the people who would be displaced, it is inevitable that the villagers would go to court.

Whether the affected villagers are indeed people whom the Forest Rights Act seeks to protect is a matter of fact that would then be left to the courts to verify, beyond final challenge in the Supreme Court. This will take time. But a lengthy pilgrimage through the shrines of graded sanctity of Indian legality is not the only future open to Posco. The company can make a fresh, larger-hearted and better funded effort to win over the villagers whose lives and livelihoods would be disrupted by the project than the current one rejected by the villagers. People need certainty about their future incomes and occupations, and these would need to be superior to what they are asked to give up. This would not take much, given how the villagers eke out a living. But it does call for imagination, empathy and a willingness to engage directly with the villagers and not just with political and bureaucratic powerbrokers.

… The state has to show its earnestness. At the same time, companies and their projects must respect, not bend, the people of India and their laws. The Posco decision sets the stage for companies to show how they are inclined.

While the news media is buzz with the conditional approval of POSCO by the environment ministry, the interview with NAC Chairperson NC Saxena elaborates on the nuance behind the approval. While I am not conversant with the detailed aspects of the law here, I hope the Odisha government follows the law of the land to the dot and makes sure that displaced as well as project affected people are adequately and properly compensated. At the same I hope people and groups who blindly oppose this focus their attention towards helping the project affected and displaced people.

Following are excerpts from a CNBC-TV18 interview of NC Saxena which spells out the nuances behind the non-approval approval.

Korean steel giant POSCO has welcomed the conditional approval, which comes three years after the plant was first envisaged. It says it will maintain 25% of the area allocated for the steel plant as green cover. As per the ministry’s conditions, POSCO says it will earmark 2% of its net India profits for its corporate social responsibility drive. It will also work on creating sustainable livelihood options for people affected by the project. POSCO adds that it plans to ensure conservation of land and marine environment at the site. However, member of the National Advisory Council or NAC, NC Saxena has said that the order should not be read as a clearance. Speaking to CNBC-TV18, Saxena said the Orissa government should recognise the rights of the people. The Orissa government’s rehabilitation package is very weak, he said. He however added that the package was not the concern of the Ministry of Environment and Forests.

…Q: Finally a clearance being given to POSCO by the ministry of environment but you and your panel had said that there were several violations of the forest rights act by the Orissa government while the land acquisition had actually taken place. Now if I look at the order that’s been put out by the ministry of environment it clearly says that the final approval for diversion of 1253 hectares of forest land for the POSCO project would be granted as soon as there is an assurance from the state government to the ministry of finance that there is indeed no violation as far as other traditional forest dweller rights are concerned, how are you reading this?

A: Infact I don’t think it can be read as a clearance because if you see the order very carefully it very clearly says that there are conditions to be satisfied. For instance it says that there are 3 conditions. People have to be living there for the last three generations, people have to be in occupation since December 2005 and also they should depend on forest lands. Orissa government’s case was that occupation is also necessary for 3 generations which is not true.

So I am very happy that the minister has clarified that it is only living which is there for 3 generations. Minister has also clarified that these people who are forest dwellers they don’t have to claim their rights, its for the state government to recognize their rights, so therefore Orissa government if it is to stick to its own records would find it very difficult to declare that none of these condition are satisfied and I am sure that people will get justice.

Q: … so then how does one actually progress from here because the riders are going to be very difficult for the Orissa government to comply with?

A: The Orissa government should first of all recognize the rights of these people and grant the rights under the forest rights act, then they can acquire the land under the land acquisition law. I do not know why Orissa government is not willing to talk to the people. The other point is Orissa governments rehabilitation package is very weak.

They recognize rehabilitation only for those who are displaced. It should also recognize those who are affected so therefore a large number of people are losing their livelihoods, their incomes are being affected and they should also be compensated. Once you do that, if my income is Rs 5000 a month and Orissa government says I will give you Rs 10000 I am sure I will be very happy so that’s how Orissa government should deal with resentment.

Q: … this doesn’t really spell out what more needs to be done to strengthen the rehabilitation package?

A: Rehabilitation package is not the concern of the Ministry of Environment and Forest and therefore the minister has rightly not dealt with that issue but that is certainly an issue which the Orissa government and also the Ministry of Tribal affairs should be concerned with.

The ministries concern, the MoEF’s concern was only with the forest conservation act and the environmental protection act and therefore they have not commented but of you read Meena Gupta’s report and also the 3 members report they have dealt with this question in great detail and they have suggested how to strengthen and augment the whole rehabilitation package.

Q: … hence the uncertainty continues?

A: Infact yes I would say that uncertainty does not continue. Orissa government has been given a very clear order and they should comply with it …

So Orissa government should go ahead recognize their forest rights and then only think of further action. So therefore I think a very clear order has been given and it can be complied with. The project can also be completed provided Orissa government has a good rehabilitation package and observes all the laws specially the Forest Rights Act.

Update: A DNA report the next day has this to say:

The favourable stand taken by the expert appraisal committee (EAC) on the POSCO steel plant in Orissa does not ensure an automatic green signal to the project, environment minister Jairam Ramesh has said.

… EAC’s positive recommendations are seen as a precursor to the ministry’s clearance for a project. Set up under the environment impact assessment notification of 2006, the committee assesses a range of issues related to a proposed project and recommends whether or not to grant approval to it. The ministry generally goes by its recommendation.

Ramesh clarified that a final decision on POSCO would be taken only after two weeks. The response has again put the fate of India’s biggest foreign direct investment project in doubt.

Following is from a report in DNA.

After running into several hurdles, the Rs51,000-crore POSCO steel plant project in Orissa has finally received the green signal from environment minister Jairam Ramesh. The decision comes as a big relief for the Indian industry which has been under tremendous pressure due to objections raised by the ministry over environment issues.

The steel project, being promoted by South Korean steel major POSCO in Jagatsinghpur district of Orissa, is the biggest foreign investment in the country. It was put on hold after the ministry cited violations of environment and forest laws by the company. The decision of the expert appraisal committee (EAC) of the ministry followed several public hearings and meetings with officials of POSCO India limited and the state government.

The EAC, however, has imposed tough conditions — running into 80 clauses — on the promoters. The most important of these is that at least 5% of the total cost of the project should be earmarked for corporate social responsibility. This means, POSCO will need to set aside at least Rs2,000 crore for this purpose only.

The committee also announced the resettlement and rehabilitation policy for tribals and fishermen to be affected by the project. Of 4,004 acres of the project area, 3,566 acres is revenue forest land. The company has acquired nearly 100 acres for resettlement of 418 families. The compensation for betel vine growers has been doubled and fishermen would get Rs2,00,000 per acre of prawn pond. Earlier, there was no compensation norm for fishermen.

The committee agreed that the plant area of 4,000 acres is compact for a 12 MTPA integrated steel plant with a captive power generation capacity and a port. It said construction of the port and development of greenery within the plant on 1,000 acres (25% of plant area) should commence simultaneously with the plant’s construction and be completed within eight years.

The project proposes establishing an integrated steel plant which will have an initial capacity of four MTPA and final capacity of 12 MTPA. It will have a captive port and a power plant of 400 MW. The EAC agreed with the seasonal basis on which the clearance was recommended in 2007 but insisted that on the basis of comprehensive environment impact assessment (EIA) report placed before it, aspects set out in subsequent paragraphs of these minutes must be revisited during the implementation of the project and conformity to norms verified and reported to the ministry.

The promoters have been asked to take steps to check vehicular pollution during transportation of raw material and finished products as well as dust emission during loading and unloading.

Raw material shall be stacked at earmarked sites in sheds/stockyards with wind breakers/shields and secure of fire hazard.

Following is from http://pib.nic.in/release/release.asp?relid=68211.

The Cabinet Committee on Economic Affairs has approved the proposal of the Government of Orissa to set up a Petroleum Chemicals and Petrochemicals Investment Region (PCPIR) in Paradeep. This is the fourth PCPIR which has been approved after PCPIRs in Andhra Pradesh, Gujarat and West Bengal.

A total investment of about ` 277,734 crore is expected in the Orissa Petroleum Chemicals and Petrochemicals Investment Region (OPCPIR), which includes a committed investment of ` 29,777 crore. The proposal envisages development of physical infrastructure such as roads, rail, air links, ports, water supply, power etc. at a cost of ` 13,634 crore. The PCPIR policy prescribes that infrastructure will be created/upgraded through Public Private Partnerships to the extent possible and Central Government will provide the necessary Viability Gap Funding (VGF). Accordingly, Government of Orissa (GoO) has sought support from Government of India involving a commitment  of 716 crore on account of VGF funding for one port and three road-related projects.

The total employment generation from the OPCPIR is expected to be about 6.48 lakh persons comprising direct employment to 2.27 lakh persons.

The PCPIR policy is a window to ensure the adoption of a holistic approach to the development of global scale industrial clusters in the petroleum, chemical and petrochemical sectors in an integrated and environment friendly manner. The idea is to ensure the setting up of industrial estates in a planned manner with a view to achieve synergies and for value added manufacturing, research and development.

The Government of Orissa proposes to set up a PCPIR at Paradeep extending over parts of Kujang and Ersama blocks of Jagatsinghpur district and Mahakalpada and Marsaghai blocks of Kendrapara district.

The State Government proposes to implement the Orissa Petroleum Chemicals and Petrochemical Investment Region (OPCPIR) under the Orissa Development Authorities Act, 1982, which is an existing State law. The State Government proposes to constitute the Greater Orissa Paradeep Development Authority as the authority in charge of the development of the Paradeep PCPIR.

The delineated region has a strong industrial base with major processing activities at present including Paradeep Phosphates Ltd., IFFCO’s Fertiliser Plant, Essar Steel Plant, Goa Carbons (Paradeep Carbons Ltd), Paradeep Port etc.

Indian Oil Corporation Ltd. (IOCL) has been identified as the Anchor Tenant for the Orissa PCPIR. IOCL signed a MoU with GoO in 2004 for setting up a 15 MMTPA grassroot refinery at Paradeep in the first phase at a cost of ` 29,777 crore. The Refinery is likely to be commissioned by March 2012 and should be fully stabilized by November 2012. The Refinery will have a Crude and vacuum Distillation Unit, a Hydrocracking Unit, a Delayed Coker Unit and other secondary processing facilities. It will also have an Integrated Gassification Combined Cycle Plant for production of steam, power and hydrogen from petroleum coke for captive use in the refinery at the cost of about ` 935 crores. A petrochemical complex will be set up at a later date depending on the market conditions.

A Preliminary Environment Assessment Report (EIA) has been conducted. The State Government will carry out a detailed EIA as per the EIA notification.

****

VBA/SH/LV

Following is an excerpt from a report in Telegraph.

… the single-window clearance committee of the state government, cleared five proposals worth Rs 1,340 crore. Industries secretary T. Ramchandru said that Orissa-based Konark Kranti Energy would set up a petroleum complex at Paradip and a petroleum storage facility at Dhamra port. “The company will invest Rs 300 crore,” he said.

Britania Industries Limited would also set up a plant at Khurda with an investment of Rs 51 crore.

Around 700 people will be employed by the firm. Everest Industry would set up a corrugated asbestos plant at Somanthpur in Balasore with an investment of Rs 69 crore, Chariot Steel and Power would expand its cement plant at Sundergarh and invest Rs 320 crore while Nababharat Ventures Limited would set up a power plant with an investment of Rs 600 crore, he added.

Following is an excerpt from a report in Indian Express.

… the government has approved the creation of two new forward naval bases at Tuticorin (Tamil Nadu) and Paradip (Orissa), and has accorded priority to the creation of operational infrastructure on the islands of Andaman and Nicobar and Lakshadweep.

The decision was announced by Defence Minister A K Antony at the Naval Commanders’ Conference here on Wednesday.

The two new bases, which will have facilities to refuel and service naval vessels as well as stocking of ammunition, will be created over the next two years. The Navy will use them for operating smaller vessels. While a decision has not yet been taken to permanently deploy warships at the new bases, with several new vessels on order, the ports will be used for future operations of the expanded fleet.

Communication stations will also be set up at the two bases.

Following is an excerpt from a report in Economic Times.

State-owned Indian Oil Corp (IOC) today said its Rs 29,777-crore Paradip refinery in Orissa will be commissioned by March 2012 and will cater to domestic market rather than exports as previous thought, due to rise in fuel demand at home.

…The refinery will produce 5.97 million tons of diesel, 3.4 million tons of petrol, 1.45 million tons of kerosene/ATF, 536,000 tons of LPG, 124,000 tons of naphtha and 335,000 tons of sulphur, all of which will be for sale in domestic market.

Some of 200,000 tons of propylene to be produced by the unit may be exported, he said.

Bankapur said the refinery will start producing fuel by March 2012 when it will commission the primary units like Crude Distillation Unit. Secondary units will be commissioned by July, 2012, and operations stabilised by November, 2012.

Besides the Rs 29,777 crore cost of refinery, the Paradip project also includes a Rs 1,793 crore pipeline to Raipur and Ranchi. The 1,100 km pipeline will carry fuel produced in the unit to consumers in Orissa, Jharkhand, Chattisgarh and Madhya Pradesh. Besides, a marketing terminal at the cost of Rs 414 crore is also being built.

IOC may take companies like Saudi Aramco and Kuwait Petroleum as equity partner in the Paradip refinery if they agree to supply most of the crude oil requirement of the 15 million tons unit.

The company wants someone who can commit long-term crude supply as equity partner but so far nothing has materalised.

IOC had last year signed a loan agreement with a consortium of lenders led by State Bank of India for term loan of Rs 14,900 crore for the project.

Bankapur said the company had some time back split the refinery-cum-petrochemical complex into two, deciding to complete the refinery first and follow with the chemical unit.

The feasibility of setting up the petrochem complex will be studied in next 3-4 months, he said.

The Paradip refinery is being configured to process the toughest, heaviest and the dirtiest crudes which are cheaper than the cleaner and easier varieties.

The refinery will have a Nelson Complexity Index of 13, the highest in the world.

Following is from http://dailypioneer.com/290501/Why-I-would-prefer-a-captive-port-for-Posco-steel-project.html.

Getting into the port town of Paradip after the ordeal of a tiring long journey from Cuttack on the State Highway is refreshing; sweeter than reaching an oasis after a long wandering in a vast desert depicting inertia and obscurantism. The experience of the musical fountain in a well-nurtured garden, the sight of a modest golf course, the neat avenues and bountiful hospitality linger on for long. The port has been expanding. Whereas the port handled 30 million tonnes (MT) of cargo in 2004-05, it handled an impressive 57 MT in 2009-10. This is the port I had served as chairman for five years, many years ago.

Many incidents surface in my memory — the removal of the two sunken dredgers close to the entrance channel of the port; the visit of the chairman of Indian Oil Corporation for setting up a refinery. Then, the Posco team’s visit for setting up a steel plant at the port town and Chief Minister Biju Patnaik’s long discussion on the issue with the visiting Koreans at the port guesthouse. At the guesthouse, one finds the foundation stone for the port with the prophetic description of the birth of the port ‘as yet another national adventure’ by Prime Minister Jawaharlal Nehru.

History is perhaps going to repeat itself. We are likely to see yet another national adventure on the coast, about 10 km south of the Paradip lighthouse. Should this happen, India’s east coast would have the most modern captive port at Jatadhari that would handle vessels of 170,000—220,000 DWT. The port would have facilities for handling smaller vessels as well. This port would be coming up at a time when the country is in great need to increase port capacity to bridge a huge anticipated capacity-gap of around 250 MT for dry cargo by 2013. On any given day, about 150 ships are waiting at anchorage in Indian waters. This amounts to an annual loss of `2,400 crore. Kandla Port handled the highest traffic in 2009-10 with 79.52 MT, and all the Major Ports handled 561 MT during the year. Share of traffic of the non-major ports has been increasing. It has risen to 206 MT in 2009-10 representing 37.5 per cent of the traffic of Major Ports.

The port sector, however, has to do much more. India’s Shipping Minister recently announced plans to triple capacity in the next 10 years so that India’s total capacity is boosted to 3,200 MT. Therefore, pace of entry of private players into the port sector has to gain momentum. Pipavav, Mundra, Krishnapatnam and Dahija are successful ports developed though private investment. Private developers would also be creating new ports at Dighi and Rewas (Maharashtra), Vizhinjam (Kerala), Kalpi (West Bengal), Gopalpur and Dhamra (Odisha). Private investments have also been made in different terminals of Major Ports like JNPT, Cochin, Haldia, Vizag, Tuticorin and Chennai. More private investments would only make our port sector viable and competitive.

The location of the proposed port at Jatadhari, south of the existing Paradip Port, would create immense opportunities for development of infrastructure facilities. Most promising opportunity for the people could be in the eight-lane expressway to connect the new port with Bhubaneswar.

One would only wish that the planners for the highway do not succumb to pressure for a zigzag alignment for the road so that it runs close to thick habitations .A straight line alignment, on the other hand, would induce planned development of the area. The proposed 12-km six-lane road along the coast would connect Paradip and the new port and make this stretch of the shore extremely popular with tourists. Besides, the new port would have connectivity with the NH-5A and the State Highway connecting Cuttack. At least two rail connections, one with Cuttack-Paradip line and the other with the proposed Haridaspur-Paradip line, would provide access to the steel plant and the new port. Plans are afoot for a dedicated rail-line from the mines to the new port. Though linking Jakhapura (on Kolkata-Chennai trunk route) with Banspani (in the mining belt) would be helpful, this line would not provide convenient access to many rich iron ore deposits of Sundargarh and Keonjhar districts. A new line should therefore connect Barsuan with the Banspani-Keojhar section and Barsuan should be connected with Talcher. The new port should be connected by a new rail-line with either Barang or Bhubaneswar by avoiding Cuttack. Such a comprehensive rail network only would ensure complete integration of the existing and the new ports with the hinterland.

Some view that the proposed port would have adverse effect on Paradip Port. People connected with Paradip are aware of the littoral drift of sand along the coast from south to north; the gradual accretion of land south of the southern breakwater of Paradip Port and erosion of land north of the northern breakwater. To contain the erosion, a seawall has been constructed north of the northern breakwater that runs up to the point of confluence of the Mahanadi with the sea. The northern breakwater of the proposed port is sometimes perceived as a feature, which could induce similar erosion of land towards Paradip. This apprehension however is unfounded, as this problem would surely be tackled through suitable engineering measures. The embankment form is expected to have in the middle portion quarry-run materials like boulders of different sizes; the seaside of the embankment is likely to be protected with acropodes and the landside with a concrete surface. The embankment is likely to be 7.5 metres high from the mean sea level and there is to be a wide road on top of it. The northern portion of the north breakwater of the new port is to be more effectively protected through better engineering measures. The southern breakwater of the port would arrest good quantity of north-moving sand and this would in fact help Paradip Port where the annual dredging would be less.

The other area of concern relates to the possible adverse impact on the business of Paradip Port. The cargo for the new port, it is pointed out, could be easily handled by Paradip Port. Actually, there is greater advantage in having two ports. The new port is expected to handle ultimately around 40 MT of cargo, but the development of the port has to go in tandem with the development of the steel plant. A port captive to the mother industry alone would be in a position to develop in conjunction with the development of the mother industry whereas such coordination may not always be possible if the port is a public port. A public port is meant to meet the requirement of many users in the hinterland.

Landlocked States in the hinterland of Paradip Port, Jharkhand and Chhattisgarh, are poised for rapid industrial development and their industries along with those in Odisha would depend on Paradip Port. Paradip Port would not be in a position to handle an additional cargo of around 40 MT of Posco plant. It is therefore only appropriate that the existing and future capacity of Paradip Port is taken advantage of by a large number of users and the Posco cargo handled by a captive port.

The new port should not therefore cause any concern; it is only a logical and welcome part of Posco-India’s project that is surely going to bring in an integrated development of the hinterland.

— The writer, a former IAS officer, can be reached at punarbashu@gmail.com

Following is from a report in Hindu Businessline.

… Orissa government on Friday approved fresh investment of Rs 6,500 crore …

The investment proposals were approved by the Single Window Clearance Committee (SLWCC) meeting chaired by the chief secretary Mr B K Patnaik here.

“The 16 projects approved today will give direct employment to 15,000 people and provide indirect employment for another 25,000 persons,” Industries secretary Mr Sourav Garg told reporters adding that projects worth less than Rs 1,000 crore got clearance from the SLWCC.

Stating that the projects were in cement (4 units), food processing (one unit), manufacturing (one unit), power (one unit), paper (one unit) and steel (five units) sectors …

The name of the companies and additional details are given in this report from Samaja.

Following is from a report in Orissadiary.

The 6-million tonne Essar Steel pellet plant here will be made operational by October this year. The `2,200-crore project includes an 8-MT ore beneficiation plant at Joda and Barbil and a 250-km slurry pipeline from Joda to Paradip. The company plans to expand the beneficiation and pellet manufacturing capacities to 12 MT in the future.

Initially, the company will source iron ore from private mines at Joda and Barbil. However, the company expects that the State and Central Governments will grant it lease for a captive mine in the long run.

The pellets to be produced at Paradip would be exported through the Paradip Port to Essar’s steelmaking unit at Hazira in Gujarat, which is undergoing a capacity expansion to 9.6 MT from 4.6 MT by 2012, said sources.

Following is excerpts from an interview in Business Standard. The investment numbers mentioned there does not quite gel with the numbers mentioned above.

Is there a time frame for realising the long-term vision?

It arises from the commitments, as well as MoUs (memorandums of understanding) with various state govts. These are linked to raw material. It’s a chicken and egg story. You need the raw material, otherwise you are not going to invest. We have our plans in Jharkhand, Chhattisgarh. In Orissa, we are already completing the first phase. In Karnataka, we have signed the MoU and the government is looking to provide land. But we also want the mines. We don’t want to create a situation where all the investments are done and then you say the mines are not available.

The Orissa government has a clause in the MoU that the state will recommend mines once you have made commitments for 25-30 per cent.

Yes, commitments have to be made, which implies it could be orders. But a 12-million tonne plant will cost anything between $12 billion and $15 billion. Thirty per cent of that will be $4.5 bn. How can anyone expend $4.5 bn in the hope that one will get the mines? It’s easier for smaller players.

Following are extracted from his article in Economic Times.

• The port town in Jagatsinghpur district, about 120 km from the state capital of Bhubaneswar, has already emerged as one of the country’s major investment hotspots by attracting investment in excess of Rs 3.5 lakh crore including the Rs 2, 74,134 crore Petroleum Chemicals and Petrochemical Investment Region (PCPIR) and the biggest FDI proposal by Posco to build a 12-million ton steel plant at an estimated cost of Rs 51, 000 crore.
• The port town already boasts of major fertilizer manufacturers like IFFCO and Paradeep Phosphates Limited, a brewery along with central depot of Indian Oil and other small industries like Kargil Oil, Paradeep Carbon and a host of other units.
• … an integrated Petroleum, Chemicals, and Petrochemical Investment Region (PCPIR), a Special Purpose Vehicle (SPV) promoted by the state government on the lines of Pudong in China, Rotterdam in Europe and Houston in North America.
• IOC is already coming up with 15 MMTPA grassroot refinery cum petrochemical complex five kilometer to the south of Paradeep Port at an estimated cost of Rs 25,646. For this, the state government has given incentives to IOC by exempting entry tax on crude oil and sales tax deferment for 11 years. The IOC already has got the required 3344 acres of land.
• The Railways is also committed to boost connectivity in the Paradeep region which includes the 82-km Paradeep-Haridaspur broad gauge line, being taken up at an investment of Rs 577.78 crore. East Coast Railway (ECoR) has acquired 1,146 acres of private land out of the total of 1,653 acres of land required for the project. This project being implemented by Rail Vikas Nigam Limited (RVNL) is scheduled for completion by March 2011.
• The other projects in different stages of implementation Hydrate Pellets Ltd’s six lakh tone hydrate pelts plant at Rs 10,724 crore, Essar Steel Orissa Ltd’s six million ton steel plant at Rs 10,721 cr], Deepak Fertilisers and Petrochemicals Corporation Ltd. (DFPCL’s three lakh mtpa green-field complex for Nitric Acid and Ammonium Nitrate at Paradeep at a cost of Rs 400 crore NSL Sugar Ltd’s sugar plant at Rs 800 crore and other mini projects.
  

One other thing that is not elaborated in the article is that as part of the PCPIR several things will be funded by the state government and several other things will be funded by the central government.The following is excerpted from an older article in Business Standard.

• “The Centre would provide this money in two phases. While Rs388 crore would come in the first phase of the project, the balance Rs328 crore would be provided by the Government of India in the second phase”
• … six-laning of NH-5 (A), building a greenfield coastal corridor, construction of all-new greenfield road from Bhubaneswar to Paradip and upgradation of port infrastructure.

• The six-laning of the NH-5 (A) will be taken up in the second phase of the PCPIR project at a cost of Rs76 crore. The greenfield coastal corridor will involve an expenditure of Rs410 crore out of which Rs 264 will be invested in the first phase while the remaining expenditure of Rs146 crore will be incurred in Phase-II.

• The construction of all-new greenfield road from Bhubaneswar to Paradip will be taken up at a cost of Rs190 crore while Rs40 crore would be provided by the Centre for upgradation of port infrastructure.

• Meanwhile, the Orissa government has committed an expenditure of Rs1796 crore on infrastructure development for the PCPIR hub. Out of the envisaged expenditure of Rs1796 crore, Rs 754 crore will be spent on development of arterial roads, Rs 465 crore on water supply, Rs 410 crore on power distribution and Rs136 crore on canal upgradation.

To match these industrial investments in Paradip, the Odisha government needs to make plans for a university, an engineering college and a medical college for this area. Similar plans need to made for the other upcoming industrial hubs at Angul,  Kalinganagar, Jharsuguda and Rayagada; as well as the only existing industrial area of Rourkela which neither has a medical college nor has a regular university.

Following is an excerpt from a report in Steelguru.com.

Paradip Port Trust is planning to have an airstrip within the port premises to facilitate movement to and from the port.

A resolution in this regard was recently passed by the board of trustees of the port. Mr Biplav Kumar chairman of PPT told Business Line that "We’ve also received in-principle consent of the Shipping Ministry.”

… The land for the proposed airstrip, as the port Chairman informed, has been identified.

Since the PCPIR in Paradip has been approved, I expect this airstrip will be established soon.