Do Not Renew POSCO MoU


To: Mr. Manmohan Singh, Prime Minister of India; Mr. Naveen Patnaik, Chief Minister of Orissa; Mr. Jairam Ramesh, Minister of State (Independent Charge) for Environment and Forests; Ms. Sonia Gandhi, Chairperson of the National Advisory Council

We write to express our concern at several violations of legal process in the approval of the POSCO project in Orissa, some of which we address below:

1. The Orissa government has violated the Forest Rights Act and the Ministry of Environment and Forests (MoEF) has chosen to ignore this illegal behavior.

The FRA, which came into force in January 2008, acknowledges the rights of all “forest dwelling Scheduled Tribes” (Section 2(c)) as well as “other traditional forest dwellers” who have for at least seventy-five years prior to December 13, 2005 “primarily resided in” and “depend on the forests or forest land for bona fide livelihood needs” (Section 2(o)).  Application of the FRA is mandatory for the POSCO project because approximately three-fourths of the 4,000 acres sanctioned for the POSCO steel plant in Jagatsinghpur district is officially classified as forest land.  Cultivation on this land has been the primary source of livelihood of local forest dwellers, most of whom have lived here for generations.

Section 4(5) of the FRA mandates that “no member of a forest dwelling Scheduled Tribe or other traditional forest dweller shall be evicted or removed from forest land under his occupation till the recognition (of rights) and verification procedure is complete”, and section 5 of the Act empowers Gram Sabhas to protect the forests and to “regulate access to community forest resources.”  Within three months after the notification of the FRA, the Gram Sabha of Dhinkia (one of the villages affected by the project), acting under the provisions of Section 6(1) of the FRA, passed a resolution inviting claims for individual and community property rights.  Section 6(3) of the FRA requires the state government to constitute a sub-divisional level committee to examine the Gram Sabha resolution and enable a final decision, but the law was violated at this stage by the refusal of the sub-divisional officer to accept the claims filed by the Dhinkia Gram Sabha.

The MoEF initially followed the law and issued a circular in August 2009 to the effect that diversion of forest land for the POSCO project would have to wait until after the rights of the forest dwellers had been recognized and would still require approval by the relevant Gram Sabhas.  However, in December 2009, the MoEF granted a conditional final clearance even though it was clear that the requirements of the law were not being met!  Given that the Orissa government has routinely used violent force and coercion against its own citizens to clear the way for its “development” projects, the farcical MoEF clearance was essentially an invitation to the state government to use all the repressive means at its disposal to push people out of the way of the corporate giant wishing to exploit the state’s resources.

2. The environmental clearance of the POSCO project is deeply flawed.

The POSCO project consists of three main parts — a steel plant, a captive port at Paradeep and mining operations.  However, POSCO applied for environmental clearance of the steel plant and the port separately, perhaps seeking to downplay the ecological impact of the entire project.  The MoEF went along with the POSCO ruse and granted a conditional final clearance for the steel plant while also approving the captive port at Paradeep.  The approval of the port was based on a highly flawed environmental impact assessment study (EIA) commissioned by the MoEF.  The EIA fails to reliably estimate the port’s impact on air and surface water quality, nor does it address the cumulative impact of the steel plant and the port on people and the local ecosystem.  Also missed in the EIA is the impact on livelihoods of the local people engaged in farming and fishing who lose their lands and access to the Jatadhari river mouth.  The closure of the river mouth would make the region very vulnerable to flooding, another aspect that has been ignored in the EIA.

3. The Orissa government has unleashed large-scale violence to push through the POSCO project.

The POSCO project has faced serious resistance from the affected people ever since its Indian subsidiary signed an MoU with the Orissa government.  Despite the grave livelihood threat that the project posed, opposition to the project has stayed well within the parameters of the law.  However, the state has hardly functioned as a representative of the people and a custodian of its rights, and has worked more or less as a POSCO agent.  In the process, it has torn the FRA to shreds and ridden roughshod over fundamental human rights guaranteed by the Indian constitution such as the right to life and freedom from torture.  The numerous instances of rights violations reported against the police include beatings, arrests, shootings and torture of (suspected) anti-POSCO protestors as well as filing of false cases against them to limit their movement.

Earlier this year, Nuagaon, Dhinkia and Govindpur Gram Sabhas passed resolutions reasserting their rights under the FRA and rejecting the diversion of forest land — their primary source of livelihood — for the POSCO project.  However, the environment ministry is yet to withdraw its conditional clearance, which, if not outrightly illegal, certainly contravenes the spirit of the FRA.  We strongly urge you to ensure proper implementation of the FRA and put into action your oft-stated goal of participatory and inclusive development.  Toward this end, we also urge you to not renew the POSCO MoU when it expires on June 22, 2010.


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The Do Not Renew POSCO MoU Petition was initiated by Mining Zone People Solidarity Group (

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