Jharkhand signed 71 MoUs with an investment of Rs 2,95,857.75 crore with the private players to set up industrial projects in the state. The State’s Industries Department in September 2006, compiled a list indicating requirement of 98,547 acres for the 55 MoUs signed between 2004-06.
However, the department does not have records regarding land required for investors who had signed MoUs after 2006. The department updated the list till August 2009 for 71 MoUs. The updated list neither mentioned the land requirement of companies nor did it have records of land needed for the projects under the MoUs signed after 2006. Director of Industries Aradhana Patnaik told Business Standard that the state government had negligible vacant land and hence it did not go for land acquisition under the LA Act 1894.
Patnaik added that as the state government was not acquiring land and the same was being purchased by the industries directly, so it would not be possible to say how many persons would be displaced.
She said the government had signed 74 MoUs till date, but three MoUs were cancelled as the signatories were not interested. She said that among the MoUs, 13 companies had started production and another 7 would launch production during the current financial year.
Referring to the state’s rehabilitation and resettlement policy, Patnaik said that a revised rehabilitation and resettlement policy had been framed in August 2008 but it could not be placed before the Assembly for approval. The Single Window System was also not placed before the Assembly. About the probable shifting of ArcelorMittal’s 12 million tonne per annum steel project out of Jharkhand due to problems of land acquisition, she said that the state government had not received any official communication from the steel major.
Industry sources said that frequent change of governments Jharkhand was carved out of Bihar in 2000 had become a major inpediment in taking up new projects. In the nine years since its creation, Jharkhand has seen four chief ministers, none of whom could complete their full term. The state had seen nine chief secretaries in nine years. Even the departmental secretaries, District Magistrates (Called Deputy Commissioner in Jharkhand), Superintendent of Police were shuffled frequently.
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The World Bank, in its report in June 2007 on Jharkhand, said that the average tenure of a secretary in Jharkhand was 15 months and a Deputy Commissioner 12 months. “Premature transfers undermine the capacity to implement reform effectively as well as continuity in administration,” the report had mentioned. The frequent transfers of officials had created bottlenecks in execution of projects.
The tribals expected that their economic condition would improve with the creation Jharkhand. Negligence of political leaders to undertake development work had given extremists an opportunity to establish their base in the state.
Extremists have a presence in 18 of the 24 districts of the state. From January 2003 to October 2009, Naxalites have killed 339 policemen in the state.
After imposition of President’s Rule, the companies which decided to set up industries had urged former Governor Syed Sibtey Raazi to intervene in curbing the Naxalites as movement of their officials in the affected districts for their work had become difficult.
Industry sources said that most of the land in Jharkhand was owned by tribals and acquiring their land was difficult after building of Bokaro Steel Plant, Heavy Engineering Corporation’s three plants and expansion projects of the Central Coalfields Limited. Some villagers whose land had been acquired in the 1960s were agitating with support from NGOs demanding “proper compensation” to them.
ArcelorMittal had given the proposal to the state government to acquire land for its proposed project of Rs 40,000 crore in Torpa-Kamdera in Khunti district on 8,800 acres of land. But the MoU signed on October 8, 2005 by the then Mittal Steel Company (now ArcelorMittal) had shown total requirement of 25,000 acres of land for its 12 MTPA steel project. After notification of the project site in January 2008, widespread agitation had started against the acquisition of land.
Proposals of three industrial houses for acquiring about 1199.85 acres in East Singhbhum district were pending with the government. A proposal for acquiring 159.35 acres from the industry department for setting up an industrial development centre at Baheragora was pending from last year.
The state government had approved the lease settlement of 416.80 acres of land in Potka for Jindal Steel and Power Limited (JSPL) for installing a 5 MTPA plant. But final clearance for land transfer and lease agreement is awaited. Similarly, Konti Steel's proposal for 165.19 acre in Ghatsila circle is pending since 2007. The science and technology department has sent a proposal for acquiring 1.04 acre for setting up a government industrial college for women at Ghatsila is also pending since 2007. Bhusan Power and Steel Limited is awaiting transfer of 450.04 acre land in Potka and Jamshedpur circles.
Several allegations were doing the rounds that contractors engaged in the execution of government and private sector projects in the rural areas had to face threats by the extremists if they refused to pay 'protection money'. The recent killing of the special branch police inspector Francis Induwar (50) and two executives of a state-run company have created adverse reaction among security forces. The recent statement of the Governor, K Sankaranaryanan, on the reported move of the shifting of ArcelorMittal project has evoked mixed reaction. The Governor had said that it would not affect the state’s industrial prospect as there were many others who would be interested to invest in the state.
Presently, in absence of clear-cut industrial policy, single window system and a land bank, investors have to run from pillar to post for regulatory clearances. According to an Assocham study on “Delayed projects and lost job opportunities,” as many as 18 projects worth Rs 2,45,000 crore were held up for the past three-four years. Implementation of these projects could have created jobs for at least 1,64,000 people directly and 2,70,000 people indirectly.The Assocham study revealed that of the foregone sum of investment due to delay in the country, more than half (Rs 1,25,940 crore) was in Jharkhand.