South Korean steel giant acquired 1,093 ha without waiting for environmental clearance
The National Green Tribunal (NGT) which suspended the environmental clearance to the controversial POSCO steel project in Odisha's Jagatsinghpur district last year, has once again stepped in to halt illegal work on the controversial project. In the past fortnight, Korean steel manufacturer POSCO, aided by state government of Odisha, acquired 2,700 acres (one acre equals 0.4 hectare) of agricultural land, including betel vines, in Jagatsinhpur district without waiting for the mandatory environmental clearance. NGT, on Tuesday, took cognisance of the violations by the steel company, which were brought to its notice through a petition filed by activist Prafulla Samantray, and asked the state government and POSCO to stall any acquisition till the environmental clearance is issued for the project. Samantaray and others stated in the petition that since POSCO does not have a valid environmental clearance, the present levelling, trench work and tree felling by the project proponent cannot be carried out.
NGT, while hearing Samantray's petition, said that the company will not acquire any land before the dispute on the environmental clearance is resolved. NGT had suspended the environmental clearance granted to the project on March 30, last year. At that time, the tribunal had asked an expert committee under the Union Ministry of Environment and Forests to review the project afresh. The committee headed by former bureaucrat K Roy Paul, in its report, sought for a complete design change of the plant.
While POSCO had agreed to reduce the land requirement for the project, private agricultural land was not acquired till recently because of protests by local residents. However, towards the end of April, the plant authorities aided by the state and local administration started land acquisition, leading to violence and an incident of bomb explosion, which killed four protesters. Paul, while submitting the report in October, had said that many important conditions with regard to the grant for fresh environmental clearance had not been fulfilled. On May 28, NGT found that important components for the grant of environmental clearance are yet to be completed, while the authorities began acquiring private agricultural land.
“The state government is yet to formulate a conversion policy for changing forest to industrial areas while it went ahead with cutting trees and destroying betel vines for the POSCO plant. The NGT's order is a big relief for us as it has directed the state government to bring out a notification to formulate policy for the conversion of such land,” said Samantray.
On the other hand, at the international level, POSCO's funders have been questioned for sponsoring the plant in Odisha, where several human rights violations have taken place in the name of land acquisition for the plant. On Monday, Norway's National Contact Point (NCP) – a body that oversees the implementation Organisation of Economic Cooperation and Development guidelines – has pulled up the country's $740 billion oil fund for aiding POSCO plant. NCP said Norges Bank Investment Management (NBIM), which manages the oil fund on behalf of the Norwegian government, has refused to cooperate with the OECD Contact Point in its assessment of the fund's investments in POSCO. “NBIM has violated the OECD Guidelines for Multinational Enterprises, and it lacks a strategy for identifying and handling possible violations of human rights in the companies they invest,” NCP said in a statement on Monday.
The investigation was triggered by a complaint from several organizations about the 12 million tonnes per annum capacity steel plant planned by POSCO, which will displace 20,000 people physically and leave them without any means of living. The complaint to the local OECD contact points of South Korea, Norway and Holland was made by the non-governmental organizations Lok Shakti Abhiyan in India, KTNC Watch in South Korea, Fair Green and Global Alliance in the Netherlands and Norway's Forum for Environment and Development. These organisations have claimed the stakeholders or funders should have used their influence to prevent or mitigate the damage caused by the human rights violations during the acquisition for the plant.
NBIM, in a reply to the allegations stated that the bank was awaiting the conclusions of the investigations against POSCO in South Korea. NBIM replied to NCT that “the OECD guidelines do not apply to minority shareholders, and for that reason refused to give answers to our written questions,” said Hans Petter Graver, chairperson of the Norwegian Contact Point. Graver in a release said that the guidelines do apply; the question is how they apply for an investor with numerous small shareholder positions.
The Norwegian Oil Fund has a 0.9% stake in the POSCO plant; the stake is valued at US $245 million. In Holland, the Dutch pension fund ABP and its pension administrator APG March, which is one of the funders, have agreed to cooperate with the local OECD Contact Point, according to the release by National Contact Point.
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