Thursday, May 03, 2007

Naxal shadow on $50 bn metal sector in Chhattisgarh, Orissa

Naxal shadow on $50 bn metal sector in Chhattisgarh, Orissa
Wednesday, May 02, 2007 16:38 IST

MUMBAI: The country's metal sector, which is estimated to attract investments of about $50 billion over the next 10 years, could be affected by Naxal-related violence in mineral-rich states like Chhattisgarh and Orissa.

Many proposed projects in steel, mining and other industries in these states are facing stiff opposition from locals and this resistance could have been fanned by support from Naxals, police sources said.

Naxalites have spread their area of influence in Orissa, Jharkhand, Chhattisgarh, Andhra Pradesh, parts of Bihar, West Bengal and Madhya Pradesh, raising concerns among not only the state governments, but also the Centre.

The sources said naxals could be tapping the resentment among farmers against land acquisition for mega projects and special economic zones by helping those facing eviction.

A number of projects such as South Korean firm Posco's steel plant in Orissa and Essar's upcoming steel plant in Maoist-stronghold of Dantewada, Chhattisgarh are among those facing resistance by locals and likely to be delayed.

More worrying is fact that most of the country's precious reserve of coal as well as ores of iron, aluminium, nickel, chromium, manganese and uranium are located in these states.

Most of the mineral reserves are located either in forested zones or in tribal areas, which are controlled by the Maoists.

According to Secretary General, Federation of Indian Mineral Industries RK Sharma, if companies take tribals and local population into confidence and tell them about the benefits of these projects, there should not be any problem.

The difficulty arises when these companies go out all of a sudden and start acquiring land he added.


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