Six years on, Posco mega Orissa project still remains on paper

The protests are not going to end any time soon as the noted social activists, including Swami Agnivesh and Narmada Bachao Andolan leader Medha Patkar, are now lending their support to the agitators

Mumbai: Exactly six years after Korean steel giant Posco signed a memorandum of understanding (MoU) with the Orissa government for its Rs52,000-crore 12 million tonne per annum (MTPA) project, the mega venture remains mired in uncertainty, reports PTI.

As the anti-steel plant agitation gains momentum, both Posco and the Orissa government have vowed to push ahead with the project in Jagatsinghpur district.

The country’s biggest single foreign direct investment (FDI) project till date has been beset by stiff protests from local communities against land acquisition. As if that was not enough, Posco’s MoU with the state government is get to lapse.

Despite obtaining a green clearance from the Union environment ministry, the project remains grounded in view of large-scale protests against land acquisition.

“We are committed to the Orissa project. We are hopeful and very optimistic about the plant,” Posco India vice-president Vikas Sharan told PTI over the phone.

On renewing the MoU, Mr Sharan said, “You have to ask the Orissa government on this matter.”

The MoU for the project was inked with the Orissa government on 22 June 2005 but no headway has been made since then.

The Pohang-headquartered steel major was to build a 3-million tonnes capacity steel plant, blast furnace or finex route during the first phase in Paradeep between 2007 and 2010 and expand the final production volume to 12 million tonnes.

The entire project requires 4,004 acres of land.

Posco will now have to sign a fresh MoU and though the Naveen Patnaik government has an investor-friendly image, it remains to be seen how proactive the state government is in the present circumstances when protests are at their peak.

“We are very optimistic over the Korean project. A committee is examining the issue of renewing the MoU after the environmental clearance,” Orissa steel and mines minister Raghunath Mohanty said.

“Protest is a common phenomenon. Besides, Posco is the biggest single FDI venture in our country. We are always ready to face any kind of pressure for the benefit of local communities as well the state,” he maintained.

The environment ministry last month gave its final clearance to the 12-million tonne plant with certain conditions, including ensuring that tribal rights and forest protection laws are observed.

The protests are not going to end any time soon as the noted social activists, including Swami Agnivesh and Narmada Bachao Andolan leader Medha Patkar, are now lending their support to the agitators.

“What is happening at the proposed project site is completely illegal. The land acquisition should happen only after proper dialogue with the local communities,” said Ms Patkar, a veteran of many a protest.

Accusing the chief minister of adopting a callous attitude towards local community, Ms Patkar asked, “Why can’t Naveen come down to Dhinkia for the people while he rushes to Delhi for talks with the South Korean president for the Posco project.”

“Why are you using the police to beat up villagers for a foreign company? Is not it illegal to acquire land of farmers without their consent? The state government and the Centre have no right to acquire land at gunpoint,” Ms Patkar said.

Meanwhile, Posco Pratirodh Sangram Samiti (PPSS) president Prashant Paikary said, “This battle will continue till our last breath.”

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SEBI to discuss NSDL’s role in IPO scam at its next board meeting

The committee, comprising of the then SEBI board members G Mohan Gopal and V Leeladhar, was constituted in 2008 to look into NSDL’s role in the IPO scam and it found various lapses on the part of the depository, as also the SEBI itself

New Delhi: The Securities and Exchange Board of India (SEBI) is set to reopen its probe into multi-crore initial public offer (IPO) scam of 2003-2006, after more than a year of declaring as ‘null and void’ the charges made by its own committee against depository NSDL and others in the matter, reports PTI.

SEBI will discuss afresh in its next board meeting on 30th June a two-member committee’s investigation report on the scam, except the part where the market regulator itself was accused of failing in its regulatory role, sources said.

The committee, comprising of the then SEBI board members G Mohan Gopal and V Leeladhar, was constituted in 2008 to look into NSDL’s role in the IPO scam and it found various lapses on the part of the depository, as also the SEBI itself.

SEBI declared the findings as ‘null and void’ on the ground that the committee had breached its mandate in making these charges.

However, SEBI has now agreed to revisit the matter after an intervention by the Supreme Court.

Subsequently, the committee’s findings would come alive again at SEBI’s next board meeting, but the regulator would consider the contents of the report as ‘recommendations and suggestions’ rather than a stricture against any entity, including SEBI, sources said.

The issue may still open a Pandora’s box, as the charges were made against NSDL for a period when it had CB Bhave as its chief, while SEBI declared the two-member committee’s probe into the matter as ‘non-existent’ at a time when Mr Bhave was serving as chairman of the regulatory authority.

While Mr Bhave had rescued himself from the meetings whenever the NSDL matter was discussed, it has been still alleged in various court petitions that he might have influenced the decision of other SEBI board members.

Mr Bhave served as SEBI chairman for three years till 17 February 2011. Prior to joining SEBI, he was heading NSDL, the leading national depository that enables holding of shares and other securities in demat or electronic format.

NSDL had first come under scanner in 2006 in connection with the IPO scam, wherein various entities had fraudulently cornered shares reserved for retail investors and sold them later after the listing.

The depository was accused of not following best practices to detect opening of thousands of fictitious accounts in the name of retail investors for share allotment in IPOs between 2003 and 2006.

After investigating into the matter, the Mohan Gopal committee submitted in December 2008 that NSDL failed in its duty and also made adverse remarks about the manner in which SEBI had handled the issue of IPO scam.

The matter reached the Supreme Court earlier this year after a special leave petition was filed in the apex court against SEBI’s rejection of the committee report.

The court expressed its unhappiness at the outright rejection of the report and asked SEBI on 28th March to reply on whether it would revisit its decision to give a clean chit to NSDL.

Subsequently, SEBI called a special board meeting on 26th April, wherein it decided to reconsider the Mohan Gopal committee's report.

SEBI informed the Supreme Court about this decision on 9th May, after which the court listed the matter for further hearing in August.

The apex court also made it clear that it was up to SEBI to accept or reject the findings of the committee.

“The sub-committee has only made some observations and not made any orders against SEBI,” the bench had said adding that it was mere suggestion in nature hence they were not binding on SEBI.

Sources said that SEBI is of the view that the committee’s report could be implemented if the strictures passed against the regulator itself and aspersions casted on its working were dropped.

The contents of the report would be taken into account as recommendations and suggestions made for improving the policy framework at SEBI and in the capital market, they added.

In the meantime, it recently became public through a RTI (Right to Information) query that Mr Mohan Gopal wrote to the prime minister in December 2010 that SEBI board abused its powers to protect Mr Bhave from facing an independent inquiry with respect to his actions as NSDL chairman during the IPO scam.

Mr Mohan Gopal had served as an independent board member of SEBI, while Mr Leeladhar was on its board as an RBI nominee.

The PMO had forwarded Mr Mohan Gopal’s letter to the finance ministry, which in turn forwarded the same to the SEBI, but did not get a reply despite three reminders.

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Fitch issues warning on Greece and the US

The ratings agency is seeing the risk of a possible Greek and American debt default.

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