Are Micro Finanace Institutions driving defaulters to the depths of despair?

The piece came in GRASSROOTS in July 2011 issue

Are Micro Finanace Institutions driving defaulters to the depths of despair?

The term ‘collection agent’ is often used in a pejorative sense. However, in Orissa, a new low seems to have been reached , with micro finance institutions, in stead of empowering women and alleviating poverty threatening defaulting borrowers to into submission

Pradeep Baisakh, Bhubaneswar

Belonging to a Micro Finance Institution dragged Nirupama Nayak, a 35-year-old woman staying in Salia Sahi slum of Bhubaneswar (Capital of Odisha), rebuked her in filthy language in front of her neighbors, roughed her up and locked her house. The incidence took place in last year when Nirupama failed to repay the installment. She had taken a loan to build her house. A humiliated Nirupama poured kerosene and attempted to commit suicide by setting herself on fire. She was, however, stopped from doing so by neighbours.

“I had taken a loan of 12, 000 from a micro finance institution for starting a small business. As my business did not do well, I could not meet the high interest rate demanded. One executive from the micro finance institution used slang and his boys physically assaulted me” alleges Malati Nayak, a resident of Sarankula, Bhubaneswar.

A leader addressing a rally of women Self Help Group members demonstrating againt micro finance institutions

“Are you such a shameless woman? Had I been in your place, I would have committed suicide!” screeched a agent belonging to a micro finance institution at Babi Parida of Maa Shakti Self Help group in Panchrida village, Nayagarh district. Babi, who had taken a farm loan of Rs 10000, was unable to repay because her crop failed.

Several such complaints are pouring in from almost all Orissa’s 30 districts, drawing the focus on how the much hyped micro finance institutions are being run. The institutions are supposed to empower women and alleviate poverty, but, ironically on many occasions borrowers have attempted suicide and, sadly, some have succeeded.

It may be naïve to consider the behavior of the office bearers of some micro finance institutions as just an expression of anger. The real intention could well be made out if one analyses the insurance linkage of every loan disbursed under the scheme. Under the scheme, insurance cover is also provided for the life of the person availing the loan. In case of her death, the insured money is given to the family, but after balance installments are deducted. Therefore suicides and deaths ensure recovery of the loan amount.

When the person taking loan becomes insolvent, the insurance cover comes in handy for the institutions. In other words, the borrowers who turn defaulter are driven to depth of despair, to suicide. One may be skeptical on such a horrendous linkage, but given the number of suicide cases reported in the state owing to the borrowing from micro finance institutions, it is difficult to throw away the premise altogether.

In Orissa, micro finance institutions have mushroomed in the state in absence of the proper banking network, particularly in the rural areas. The institutions are doing good business with the success almost percolating to grassroots. There are about 30-35 such institutions operating in the state, most of whom function as NGOs. They operate like non-profit organisations, but make huge profit by charging high interest. In the past four years (2006-2010) the institutions have lent Rs 1500 crore, covering 20 lakh customers, the rate of return being 95 percent.

Even though the annual rate of interest chargeable by micro finance institutions has been fixed in the range of 15-28 percent by State Level Banking Committee (SLBC), the real rate of interest varies from 30 to 35 percent. Some institutions allegedly charge up to 60 percent. In the case of Babi, she was given a loan of Rs 10,000 with Rs 1550 being deducted at source citing insurance cover, registration charges etc. She had to pay a Rs 225 every week for 50 weeks. That means for an effective loan of 8500, she has to pay 11,250 in 50 weeks in installments; the interest rate thus hovers around 32-percent mark.

The micro finance institutions use all possible coercive methods to recover the loan installments. They include causing physical and metal humiliations. Sai Prasan, an expert on financial matters, says “Banks give loan to the costumers at 10 percent interest, but micro finance institutions charge more than 30 percent.”

The institutions avail loan from banks at the rate of 12-15 percent. They, however say that they adhere to all norms and guidelines laid down by RBI and SLBC. Bijay Pandia, Branch manager of a micro finance institution says “We charge 1.03 percent interest rate per month and do not use any coercive method for loan recovery”

Devinder Sharma, a critic of micro finance institutions say “If any of us takes loan at least at the rate of 24 percent annual with weekly repayment of installment, s/he will fall in to BPL category in some years.”

Last year in Balasore district a farmer committed suicide owing to his inability to repay a loan. Similar such cases of suicides have poured from various parts of the state. Although the government came out with the figure of 46 farmer suicide cases which occurred in 2009-10 to 2010-11, the real number is quite high. “Farmers borrow from micro-finance organizationsthe money-lenders and of course from the banks. The cases of the farmers committing suicides owing to non-payment of installments to the micro finance institutions are much more than the other two categories.” Says Sai Prasan

A sub committee of State Level Banking Committee (SLBC) was formed in November 2010 by the government to look into the regulatory aspects of the micro finance institutions.

As early as in 2006 such a sub-committee was formed but with no impact. The micro finance institutions seem to have been given a free run in every nook and corner of the state to bring people into debt trap. People have even sought multiple loans from different micro finance institutions. A new loan is taken to repay the installment of an old one.

The Andhra government recently brought an ordinance regulating the micro finance institutions, owing to large-scale instances of suicide by borrowers. The state government of Odisha is yet to take such a measure, although it has written to the central government urging for a comprehensive legislation regulating the functioning of such institutions.

The Odisha government wants to bring Bt Cotton to Kalahandi

The interview came in Tehelka on on 18th July 2011

Web Link: http://www.tehelka.com/story_main50.asp?filename=Ws180711The_Odisha.asp

The Odisha government wants to bring Bt Cotton to Kalahandi

P Sainath, Rural Affairs Editor, The Hindu and 2007 Magsaysay award winner, shares with Pradeep Baisakh his views on the POSCO project, Odisha farmers’ suicides and the National Food Security Bill

P Sainath, Rural Affairs Editor, The Hindu (Photo by Abhisek Pande)

You have visited Odisha quite often. How, in your view, has it changed in the last 20 years?

Inequalities have increased massively. Earlier, we used to hire jeeps which were falling apart. Today, to go to Kalahandi, you have Innovas, Scorpios, Safaris. And in the same place there are people who have pledged their crop until 2015 to moneylenders.

Kalahandi’s problem is exploitation even today. Odisha’s per capita food production is higher than the national average for last 30-40 years and Kalahandi’s per capita food production is higher than the state, but people do not know that. Now, that very secure and very diverse food base is being destroyed. I hear the Odisha government wants to bring Bt cotton to Kalahandi. Bt will drink up the water. It will be a wonderful bonanza for the seed companies, a few traders and 10-12 big farmers. Everybody else will suffer.

The state has shifted its base – now it is just a depository of raw materials and minerals. The character and richness of the state has been reduced to being the playground of the extractive industries. That is the difference.

You visited the proposed POSCO area in Jagattsingur, then Kalinganagar, then Gopalpur: it’s like a going backward in the history of industrialisation and displacement in Odisha. What did you find?

In 1997, the government first acquired almost 3,800 acres in Gopalpur. It gave people Rs one lakh compensation per acre, said that there will be a steel plant and every family will get a job. Nobody got jobs and there is no steel plant now. The state government has declared it will not even try to make a steel plant, instead it has got ‘in principle’ approval for an SEZ. The land now costs Rs 40 lakh an acre. At the end of the day, there is no obligation to give any jobs! Those villagers there who fought it out and did not give their land are in much better position today than those who were supposed to be helped by the project.

In Kalinganagar, it’s a very, very bad situation. Over so many years of isolation and criminalisation, people have been broken. Every now and then one more family gives in. They are not happy with it nor are they doing it voluntarily, they are not just able to cope any more. Those who had large houses with lots of space for livestock have been shifted to box houses in the rehabilitation colony. The government says that’s what they chose to build, as if this does not depend on how much money has been given for house construction. There is neither factory nor any meaning job except some training given to people.

In the proposed POSCO area is some of the most profitable farming I have seen. Social activist Jagdish Pradhan and I spoke to a lot of farmers and calculated, taking note of the input cost, that one betel farm over one-tenth of an acre earns a profit Rs 1.5-2 lakh. That is actually a stunning return, and these are ordinary people.

One of the farmers we spoke to has three acres. He spent Rs 10 lakh on his four children’s education and is building a house with Rs 9 lakh. Also, in the last 10 years, betel leave prices have shot up—what used to be Rs 15-20 per 1,000 leaves is now about Rs 1,000. So they are doing pretty well. Where is the demand for jobs? Rather, there is a demand for labour. That place, I am willing to assert, has the highest wage rate in Odisha, Rs 200 plus a meal, higher than wages that construction workers get in Bhubaneswar. If you are doing skilled work like manure application, or tying and untying creepers it’s Rs 400-500 rupees a day plus a meal. Put together the average wages is about Rs 250 a day that is twice the MGNRGEA rate in Orissa, which is Rs 125.

So you are going to destroy something that exists, where employment has been created by the people themselves, in exchange for something that Gopalpur and Kalinganagar show might never come.

But if enough compensation is given, are you still against the acquiring of farmland?

Suppose I say, a huge development project involves destruction of Taj Mahal and Gateway of India, but the compensation is adequate. What sort of argument is that? People sometimes want to sell their land, I agree. But you do not make them sell at the point of the gun. You do not beat them, raid them and isolate them in their villages when they refuse to sell. In case of Gopalpur, Tatas will make money renting out plots to other companies in the industrial park. Why could that money not gone to people themselves?

What about the Land Acquisition Bill? You must be closely following developments on that front.

I am not so excited about the Bill. One, is it the job of the state to transfer resources from ordinary people to a handful of private people? By this you are narrowing the base of ownership of resources in this country. Second, it stinks of corruption. You need to check on the assets of every major officer involved.

Talking of resources, why should you give away 600 million tonnes of iron ore to POSCO at a fraction of the international price? Our new royalty law is better, but fixed on the domestic price, not the international price. So you are allowing a loot and plunder of precious resources, mindless of environmental consequences and calling it development! The younger generation does not want to be in agriculture only because we have made agriculture pathetic.

We did not hear of farmers’ suicides in Odisha earlier. What change has occurred in the state to bring them about?

Farmers’ suicide in the eastern belt are considerably less than in other parts which have opted for cash crops fed mostly by chemical fertiliser, hybrid seeds and Bt seeds. In eastern India, the people still are dependent on food crops. But Odisha too is gradually adopting the cash crop model. The situation will worsen, for the planning model is to promote cash crops, mostly for export.

What’s your reaction to the draft legislation prepared by the National Advisory Council (NAC) on National Food Security which does not advocate universal PDS?

I differ. Food, healthcare, education and decent work should be universalised. It’s incorrect to think that universal PDS is not possible or difficult as ‘leakage’ takes place. Kerala has already shown the way. Functioning of PDS improved in Tamil Nadu as it moved towards universalisation.

People say journalists should be impartial, they should not be activists. But when we see you, the journalist and activist merge.

I do not see it that way— I see myself as a reporter. If I were an activist, I would be organising.

In any society, if you go against the dominant ideology, you will be branded. If you write about POSCO, or about any dam or any other project, you will be called an activist if you write about the affected people.

There was this Brazilian priest who said, “When I give food to the poor they call me a saint, when I ask why the poor are hungry, they call me a communist.”

Pradeep Baisakh is a Freelance Journalist based in Odisha. He has extensively written on issues relating to MGNREGA, Industrialisation and displacement, Forest and environment, Right to Information, migration etc. E mail: 2006pradeep@gmail.com

With inputs from Kedar Mishra and Abhisek Pande

Clearing Forests and People in Odisha

The piece came in Counter Punch, a leading Journal of United States on 15th July 2011

Web Link: http://counterpunch.org/pradeep07152011.html

Why the POSCO Project is Illegal

Clearing Forests and People in Odisha

By PRADEEP BAISAKH

While granting final forest clearance ( http://www.environmentportal.in/files/Posco-final-orders-02052011.pdf ) to the POSCO project on 2nd May 2011 in the Indian state of Odisha, Jairam Ramesh, Minister of Environment and Forest, Govt of India and the much touted new green hero of the day, said “Faith and trust in what the state government says is an essential pillar of cooperative federalism.” And, he goes by the words of the state government apparently forgetting that it’s the ‘Rule of Law’ that guides the centre-state relationship, not ‘faith and trust’. The minister, who acted quite un-green in approving the project, should have been little more vigilant in believing the vague terminologies invoked by the state government like ‘faith and trust’ while there are recorded evidences of malafide by state government in furnishing false information, particularly on settlement of Forest Rights Claims in the area, to the central government.

POSCO project

On June 22, 2005 Pohang Steel Company (POSCO), a large South Korean corporation, signed a Memorandum of Understanding (MoU) with the Government of Odisha. This understanding outlined POSCO’s proposal to invest $12 billion ( around 54 thousand crores in Indian rupees) and plan to build a 12 Million Tonne Per Annum ( MTPA) integrated steel plant, captive port and mines in Erasama block of Jagatatsinghpur district. This is tipped as the highest FDI to India. 4004 acres of land is required for establishing the project of which about 2900 acres are forest land and the rest are private land. In addition to this, land for a railways, road expansion and mine development are also to be provided. The MoU was however valid for five years, which stands expired now. Renewed MoU is yet to be signed as both the parties are in final stage of negotiation on clinching out the nitty-gritty of the MoU. The people of the area have been opposing the project from the beginning.

Palli Sabha resolutions ignored

The first and foremost issue is relating to Palli Sabha (Palli Sabha is the assembly adults of a revenue village which is synonymous to the generic term Gram Sabha) resolutions of the Dhinkia (held on 21st February 2011) and Gobindpur (23rd February 2011) villages under Dhinkia Village Panchayat (Village Panchayat is the lowest elected body in India), which dismissed the diversion of forest land to the project. (Three Village Panchayats are to be affected by the project; they are Dhinkia, Nuagaon and Gad Kujang) These resolutions were sent to the Minister by the anti-project outfit POSCO Pratirodha Sangram Samiti (PPSS). In his order the Minister relied on the fact submitted by the state government, given in response to the resolution, that resolutions were signed by some 69 out of 3445 voters in Dhinkia village and by 64 out of 1907 voters in Gobindpur village. This lacked the quorum, argued the state government. (The quorum under Forest Rights Act (FRA) mandates presence of two third of total voters of the village in the Palli Sabha meeting). However in reality in case of Dhinkia Palli Sabha resolution the numbers of signatures are 1632 and in case of Gobindpur it is 1265. Prashant Paikrai, the spokes-person of the outfit says “We had faxed only two pages of the resolution to MoEF but the complete copy was sent to both the MoEF and state government by registered post. The state government has lied on the number of signatures backing the resolutions. Still unfortunate is that Jairam Ramesh also accepted it unquestioned. The facts have now been presented before the High Court in a petition.”

Apart from the ground of quorum, the state government also has raised the issue of power of the Sarpanch (Elected head of a Gram Panchayat) to convene a Palli Sabha. In the response to the issue the state government has stated “Two resolutions purported to have been passed by the Palli Sabha are not available in the book (recorded by the gram panchayat secretary and signed by the Sarpanch) and are therefore fake ones”. MoEF also purportedly analysed various provisions of Orissa Gram Panchayat Act, Forest Rights Act and Rules and came to the conclusion that the resolutions are not valid documents. Many legal experts do not agree to the conclusion of the state and central government. In fact, the Odisha Chief Secretary’s order on 4th February 2009 states that when the Forest Rights Committee in a village wishes to present its findings there is no need to wait for any government decisions to convene any Palli Sabha and the ward member and Sarpach have to be impressed upon the need to hold the Palli Sabha. In the records relating to the aforesaid resolutions, the Panchayat Secretary writes that he could have not attained the meeting as there is no government order for him to attend. While in genuineness the Panchayat Secretary is guilty of violation of provisions for not attending the meet, to suit to its agenda the state government has suspended the Sarpanch of Dhinkia Panchayat Sisir Mohapatra for what it termed as ‘over-stepped his jurisdiction’. Legal expert Prasant Jena opines “Suspension of a democratically elected Sarpanch in such instance amounts to misuse of power by the state government”.

Irrespective of the technicalities involved, what is clearly visible here is the substantive aspect of the FRA has been relegated by the procedural aspects. The substance is that majority of people there opposed the diversion of forest land for the POSCO project. In fact the current acquisition of forest land by the state government for purpose of diversion has also not been backed by any Palli Sabha resolution which is mandatory under section 4 (5) of the law and the MoEF guideline dated 30 July 2009 . So it’s a legal violation which is now being contested in the High Court. The state government however is of the opinion that since there are no tribals and other traditional forest dwellers (OTFDs) (OTFDs are non-tribals dependent on forests), no such resolutions are needed!

Earlier in February 2010, Palli Sabhas in Dhinkia, Govindpur and Nuagaon villages were convened on the direction of the District Collector and passed resolution rejecting the forest diversion proposals for the project. All these resolutions however have been disrespected while final clearance was granted to the project by the Minister.

Claims under FRA not settled

The state government has been contending that there are no tribals and other traditional forest dwellers (OTFDs) in the area. This is factually incorrect. 2001 census itself shows there are 23 tribals in Polang village under Kujang Tehsil. Polang is one among the villages which is covered under the proposed project.

Photo: Survey of India map showing existence of forest in Dhinkia, Nuagaon, Gada Kujang in 1928-29

Under the definition, people living in the area and dependent on forest for three generations or 75 years prior to 13th December 2005 will be considered to be OTFDs. The state government claims that there was no forest in the area earlier. Only in October 1961 it was declared as forest under the Indian Forest Act. So the people living there could not have been dependent for 75 years on ‘Forest’. This negates the possibility of anyone falling under the category of OTFDs. Contrary to the government’s claim however, the map of Survey of India shows that as early as in 1928-29 the area was a forest land under Cuttack district (See Pic). (Jagatsingpur district was part of former undivided Cuttack district). Madhu Sarin, a renowned expert on forest issues, rubbishes the linkage of period of notification of forest to claims under FRA. She says “Under FRA the definition of forest includes all kinds of forest e.g. unclassified forests, reserved forests, existing or deemed forest, wild sanctuaries, national parks etc. It does not say that it should be notified in such and such year. If that has been the case then large parts of Odisha are not forest land as a large chunk of land in scheduled areas were notified as reserved and protected areas after independence.”

Records show existence of traditional forest dwellers

A record of rights of Giridhari Bardhan of Govindpur village is provided here collected from survey and settlement manual 1927 (Document available). In fact in his letter in August 2010, Dr N C Saxena, Chairperson of FRA monitoring committee constituted by MoEF and MoTA (Ministry of Tribal Affairs, GoI), has written to Jairam mentioning about ten documents providing the proof of existence of OTFDs in the area.

Saxena wrote in no uncertain terms that there was violation of Forest Rights Law in proposed POSCO area by the state government. Majority members of the POSCO review committee (Headed by Ms Meena Gupta) held that there was gross violation of environmental laws, fabrication of evidence, perpetuation of forest rights violations and suppressing facts relating to the Costal Regulation Zone (CRZ). They even recommended prosecution of the authorities who had violated the provisions of the Forest Rights Act (FRA) and other environmental laws.

Ignoring all the evidence of violation of laws the Environment Minister gave approval to the project. Not surprisingly, just after four days of final approval to POSCO, the Minister said on record that he is forced to regularise illegalities many a times!

The ongoing period in the area is witnessing unprecedented stand off between the administration and the people with heavy deployment of police force on one and people sitting in Dharanas (protest demonstrations) on the other. While some of the lands have been acquired by administration after the approval from MoEF, it is facing stiff resistance from people in Dhinkia and Gobindpur villages.

Pradeep Baisakh is a freelance journalist based in Odisha (An Indian State) . He can be contacted through e mail: 2006pradeep@gmail.com

War Zone In Proposed POSCO Project Area

The piece was carried in Counter Currents on 14th July 2011 and in Delhi Talks on 3rd August 2011

Web Link: http://www.countercurrents.org/baisakh140711.htm

Web Link: http://www.delhitalks.in/war-zone-in-the-name-of-development.html

War Zone In Proposed POSCO Project Area

By Pradeep Baisakh

14 July, 2011

Countercurrents.org

Children in Dharana (Photo by Pradeep Baisakh)

By providing the environment and forest clearance to the 52,000 crore ($12 billion) POSCO project in Jagatsingpur district of Orissa, the much touted Green Minister of India Jairam Ramesh (He has been recently made the Rural development Minister) knowing or unknowingly opened the road for possible bloodshed in the area. Last some days have witnessed how the state administration has been unperturbed in its resolve to acquire land in the area to be handed over to the POSCO Company for establishing the steel cum power plant despite insurmountable resistance of the local inhabitants.

About the project

On June 22, 2005 Pohang Steel Company (POSCO), a large South Korean corporation, signed a Memorandum of Understanding (MoU) with the Government of Orissa. This understanding outlined POSCO’s proposal to invest $12 billion ( around 54 thousand crores in Indian rupees) and plan to build a 12 Million Tonne Per Annum ( MTPA) integrated steel plant, captive port and mines in Erasama block of Jagatatsinghpur district. This is tipped as the highest FDI to India. 4004 acres of land is required for establishing the project of which about 2900 acres are forest land and the rest are private land. In addition to this, land for a railways, road expansion and mine development are also to be provided. The MoU was however valid for five years, which stands expired now. Renewed MoU is yet to be signed as both the parties are in final stage of negotiation on clinching out the nitty-gritty of the MoU.

Stiff resistance to land acquisition process

After getting the ‘go ahead’ from the Ministry of Environment and Forest (MoEF), GoI on 2nd May 2011, (link of the final order http://www.environmentportal.in/files/Posco-final-orders-02052011.pdf ) the state administration focussed acquiring land in (from 18th May 2011) in Polang , Noliasahi and Bhuyanpal etc villages under Gadkujang and Nuagaon Panchayats where most people barring some were persuaded and threatened to hand over their land in lieu of compensation. Betel vines, the major source of livelihood of the people in the area, were pulled down by the administration. Armed police dragooned the people who opposed the government and took into custody 17 people including some 6 children (later released after they signed in a plain paper) for what government said ‘obstructing the government operation’. Basu Behera, the Panchayat Samiti member of Gadkujang Panchayat and vice President of PPSS (POSCO Pratirodha Sangram Samiti), the outfit opposing the project bled owing to the police attack. The administration allegedly engineered infighting between the pro- and anti-POSCO groups where the pro-POSCO people to burnt down the betel vines of Natha Samal, the PPSS member from Nuagaon village.

The police faced unprecedented resistance from people when it attempted to enter the Govindpur village under Dhinkia Panchayat, its next target, which is considered to be the bastion of PPSS. 20 platoon armed police force were deployed to tackle the situation and the District Magistrate Narayan Jena and Superintendent of Police Debadutta Singh were personally present to supervise the operation. More than 3000 people formed human chain and lied down on ground at the entry point to the village (during first half of June 2011). Manjulata Dalai of Govindpur village, who was sitting in Dharana, says “If the land goes to the company, we will die anyway. It is better to die now in pursuit of protecting our land than dying after losing the land”. In a novel method about 600 children formed the frontal barricade and prostrated on the hot sand preventing the entry of police to their villages. While administration cried foul over the use of children in the struggle claiming it to be violation of child rights, the villagers apparently had no option left but to take help of the children to protect their homeland. Priyanka Dalai, a girl reading in 5th class, who sat on Dharana said “We will not leave our land. We will protect it at any cost”. The district administration had gone on record saying that they could use force to acquire land. The situation looked very precarious where the people were lying on ground under scorching sun while the police was ready just 500 metres away. Imposition of section 144 of CrPC and repeated warning by the district Superintendent of Police to leave the land fell into deaf ear; people did not budge. Dr B D Sharma, former SC/ST Commissioner who visited the area told the media that the determination of people not to leave their land in unshakable. “People are protesting here for last 6 years. Even then if the administration resorts to use force leading to any loss of life, it would amount to genocide for which the administration will be fully responsible”. The human chain continues in the area even now.

The participation of children was defended by Abhaya Sahoo, leader of PPSS who said “Since the parents are being beaten up by the police and the armed police are confronting the democratically protesting People, so the children are compelled to participate in the protest Dharanas. I will say it’s the higher consciousness of the children that they have come forward to rescue of their parents and to safeguard their livelihood.” In fact the new strategy of taking help of children had apparently become inevitable in backdrop of event a year earlier in May 2010 where people were fired rubber bullets and tear gas, were lathi charged and local houses were burnt at Balitutha, the entry point to the three affected Panchayats leaving more than 100 people injured including several women. Children were kept in the front to negate such a possibility.

Temporary retreat by government

Unable to break the determination of the people the administration made a retreat and declared a temporary suspension of acquisition operation only to be redeployed later of and on. But until now the administration has not use force to drive out the people. There are apparently some concrete reasons why the administration opted not to use force on the democratically protesting people. First, the children barricade proved to be too impervious to be broken. Moreover, it did not want to create another ‘Kalinga Nagar’ where 12 tribal people were shot dead by the police in January 2006 in Jajpur district of the state. Since the firing there has been no significant progress of industrial work in Kalinga Nagar. This had happened when administration was facilitating construction work for TATA steels. This one incidence has left indelible blot on the image of Naveen Patnaik at the national and international level. Despite a thumping third time come back to power, Naveen can ill afford to have earned another killer image like that in Kalinga Nagar, though it would not deter to use force to disperse the crowd. Secondly, almost all the political parties barring the ruling BJD, throng to the area extending support to the protesting mass and decried any use of force on the people. CPI, CPI (M), Congress, BJP and other small parties sent their representatives who sat alongside the people and thwarted any possible police action. A series of social activists of national stature Medha Patkar, Swami Agnivesh, Vandana Shiva, Trade union leader Gurudas Dasgupta, Retd Justice of Bombay HC Justice Kolse Patil, Magsaysay award winner Sandeep Pande and others sat beside the women and children and extended solidarity to them.The demonstrations of the political parties and social activist continue in the capital Bhubaneswar of and on. Medha and Agnivesh appealed to Naveen government to hold dialogue with the people. Third and most important reason that prevented government using force is the 24x7 presence of media, most importantly the electronic media which made live telecasts and kept a close watch over the warlike situation. The strategy of children prostrating under hot sun caught the limelight of the people across the globe and sympathy waves flowed in support of the people determined to sacrifice anything and everything for their land. People from 64 countries, in a signed petition, have urged the Chief Minister not to use force and hold dialogue with the people.

Jairam Ramesh also issued a statement to the state government that approval of the project by his ministry should not be treated a licence for the government to use force on people.

Uncertainty looms large

 While the administration has already acquired some 1800 acres of land out of proposed 3719 acres (reduced from the original plan of 4004 acres) and started construction work even when there is no valid MoU between the state government with the POSCO company, uncertainty looms large over the future of the project so also the life and livelihood of the people. Of 3719 acres, 2900 acres are forest land, which the government claims to be of its own. Claims under forest Rights Act have however not been settled, though administration claims that there are no eligible claimants for forest land in the area. Separate expert committee reports headed by N C Saxena and Meena Gupta have found gross violation of the forest rights law by the state government in the area.

22nd June was observed as the ‘Black Day’ by the anti-POSCO people in Govidnpur village. On this date in 2005 the MoU was signed by the state government with South Korea steel giant. On the day, while the retreat by the government was celebrated as a temporary victory of people, Abhaya Sahoo, the leader of PPSS cautioned people of the possible ploy of the government to come in a big way following the retreat. Prashant Paikrai, the spokesperson of PPSS Said “We have concrete information that the government is attempting to arrest leaders from the village including Abhaya Sahoo so that the movement becomes weak.” On the other hand the Chief Secretary of the state, Bijay Patnaik has reiterated that the government is for peaceful land acquisition. “We have asked the district administration to motivate people to cooperate the administration in support of the mega project”. But police platoon are still camping in the schools in the area raising doubts over the intention of the administration more so when no such offer of talks have been declared by administration despite repeated requests and petitions from different quarters. National Commission for Protection of Child Rights (NCPCR) appealed the government to withdraw police force from the schools for their smooth functioning.

In the mean time some affected individuals like Nishakar Khatua and five others have filed writ petition near the state High Court to quash the forest and environment clearance order of the MoEF, GoI claiming that FRA is violated and to stop land acquisition in the area. The Court has started hearing the petition, though any concrete ruling is yet to come.

Coming days will determine the future of industrialisation in the state that has signed more than 79 MoUs in last ten years but whose track record of following them has been poor. The intent and courage of Naveen government in reckoning and accommodating the view of the people in the process will prove to be the key in resolving issues.

Author is a Freelance Journalist based in Bhubaneswar, Orissa. He can be contacted by e mail: 2006pradeep@gmail.com