The Maoists have been flushed out of Lalgarh in the West Medinipur district of West Bengal just three days ago, and West Bengal Commerce and Industry Minister Nirupam Sen considers it a shot-in-the-arm for investments in the state.
“Lalgarh will help us. People there were living in fear. With the help of central forces, we are bringing back security in the area. And investors want security,” Sen said. He should know this more than anybody else after the Tata pullout from Singur and the Nandigram violence
Sen’s relief is understandable as Lalgarh is just 15 km from JSW Steel’s 10 million tonne plant at Salboni located in the same district and around 100 km from Bhushan Steel and Videocon’s proposed mega projects. Videocon is setting up a Rs 15,000 crore steel and power project while Bhushan Steel is planning a Rs 8,800 crore project.
Investors agreed. Videocon Group Chairman Venugopal Dhoot and Bhushan Steel’s Managing Director Neeraj Singal said the matter would be sorted out soon.
Videocon and Bhushan Steel’s investments are a part of a host of projects announced in the state two years ago. Of the 164 projects in the pipeline, iron and steel has the lion’s share at 67 per cent. The single largest investment is from JSW Steel at Rs 35,000 crore.
Sajjan Jindal, vice chairman and managing director of JSW Steel, said that he would have to push through the project. “There will be negative people…We have thousands and lakhs of shareholders, but we have to push this project through.” Jindal also said that he was aware that it was not an easy part of the country.
Sen said if steel companies could operate in Chhattisgarh, Jharkhand and Orissa, there was no reason why they should not be able to function in West Bengal.
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He has a point. For, Lalgarh is just a tiny part of the 'Red Corridor’ – an euphemism for Maoist strongholds -- that cuts across the country from the Uttar Pradesh-Bihar border through West Bengal, Jharkhand, Orissa, Madhya Pradesh, Chhattisgarh, Andhra Pradesh, Maharashtra, Karnataka, and Tamil Nadu. Ironically it’s the mineral-rich states in the corridor, which are the most affected.
But companies are waking up to the problem and have started income generation programmes for the locals and tribals – one way to keep them in the mainstream. S K Roongta, chairman, Steel Authority of India Ltd (SAIL) said, the company helped create self-help groups for women and education of locals. “It generates a lot of goodwill for the company. Locals are also involved in our core activity, so they have a stake in the welfare of the company. We also adopt the children and educate them.” SAIL plants are spread across Chhattisgarh, Orissa and West Bengal.
However, the public sector steel behemoth’s corporate social responsibility would be put to test once it embarks on further exploitation of the reserves of its Chiria iron ore mines, nestled in Naxal-infested Saranda forest of Jharkhand.“Our social work will continue,” said Roongta, when asked how the company would tackle Chiria.
A Tata Steel spokesperson said over the last 100 years, Tata Steel has continuously contributed to the socio-economic development of the rural community that surrounded its operations in Jharkhand. “That has given us the licence to operate in the area. We have earned it,” he said.
Sen said Maoist insurgency existed in all the mineral-rich states with varying degrees. Despite being mineral-rich, the Centre ignored these states and poverty crept in and the Maoists just took advantage of the situation. The policy of freight equalization also took away the region’s edge over the rest of the country.
Consider these figures: Chhattisgarh accounts for 19 per cent of the total high-grade iron ore reserves in the country, 16.36 per cent of coal; Jharkhand has 27 per cent of iron ore and 29.17 per cent of coal. Orissa has 33 per cent of iron ore and 24.47 per cent coal, and Andhra Pradesh has one per cent of iron ore and 6.8 per cent coal. West Bengal has no iron ore but accounts 11 per cent of coal reserves of India.
Yet, Chhattisgarh, Orissa, Jharkhand and West Bengal are in the “alarming” category while Andhra Pradesh is “serious”, according to the International Food Policy Research Institute’s Indian State Hunger Index 2008.
A steel producer said lack of will on the part of political parties and poverty have kept the Maoists alive. As of April 2009, the total Left-wing extremist affected districts were at 195 and affected states are at 16, according to Institute of Conflict Management’s South Asian Terrorism portal.
While West Bengal is moderately affected, Chhattisgarh, Orissa and Jharkhand, commanding the biggest share of investments in the steel sector, are highly affected.
Risk analyst, columnist, and author of Red Sun: Travels in Naxalite Country, Sudeep Chakravarti , in an e-mail interview said, “Today’s incarnation, largely led by Communist Party of India (Maoist), is coincidentally concentrated in areas that have overlays of both mineral reserves and forests. These are also the areas with high concentrations of exploited tribal populations and the dirt-poor non-tribal, who make a living from forests. While forest areas offer Maoist rebels some refuge, the Maoist footprint has spread far beyond forests.”