Analysis of POSCO Steel project in Odissa. Its implication on business, government and Society. Pro and Cons of the project.

1. The more we know, the more ignorant
we become in the absolute sense.

3. Presented By
Group 3
The POSCO Impasse:
Development vs. the Environment

4. Mineral Map Of Odisha

5. Odisha: A contrasting story

6. POSCO
 South Korean company
 4th largest steel co in the
world
 Named 146th largest co by
Fortune in 2012
 30+ MTPA annual
production
 Present in 16+ countries

7. Proposed Project
Purpose Location Scope
Steel Plant- 12MTA Erasama Block, 10km
from Paradeep
Approx. 4000 acres
out of which 3000
acres are forest land
Mines 600 Million
Tons
Khandadhar Hills 2500 hectares, No
clear area
demarcation
Township At steel plant & at
mines
2000 acres
Water Jobra Barrage of
Mahanadi River
3.5 m3 per second

8. Perspectives from business
 The Indian steel industry
 Policy amendments
 Implications:
1. Utilisation of Mines
2. Technology Development
• Finex technology – Innovative and cost effective technology; Developed by
POSCO and Siemens
• Cost effective and environment friendly – low emissions of sulphur oxide,
dust etc.

9. Perspectives from business
 Development of the market
The economic internal rate of
return to India was projected to
be 16.6%
Even in case of a 10% lower level
of sales, the rate of return would
be 13.9%
The economic impact to India’s
population would be Rs.112
billion (assuming a discount rate
of 12%)
Figures Based on a study conducted by NCAER

10. Benefits for POSCO
• Extraction of Iron Ore - Profit of ₹6500 cr. per
annum for a period of 30 years
• High grade Iron Ore at low cost - 100$/ton in
International market – 12.5$/ton in India
• Savings in sea freight charges for 48 million
tonnes ~ $2400 million (considering a flat
freight charge of 50$/ton)
Perspectives from business

11. Perspectives from business
 Gains from multiplier effects of steel
Sectors Output multiplier
(₹ lakhs)
Employment multiplier
(man-years of
employment)
Iron Ore 1.40 0.3543
Iron and Steel 2.36 0.6920

12. Investment of Rs.51,000 crores
Project contributes 11.5% in the GDP of the state by 2016-2017
POSCO will invest in infrastructure, mining, integrated township, water supply projects and port
Promising 870,000 person-years of employment over 30 years
Access to low-cost resources - land, manpower
Railways, Roads & Ports - transportation development
Economies of the MoU

13. Towards industrialization and
development
• Goal of NSP - 100mt/year by 2019-20
• POSCO project
Perspectives from the Government

14. Benefits for India
• Significant GDP increase: ₹12100 cr. by the
end of 2016-17
• Tax revenue of ₹2620 cr. by the end of 2016-
17
• More than 50,000 jobs that last for 30 years
Perspectives from the Government

15. BJD - The party in power. They supported the project but some of the
party members oppose the displacement.
Congress - The centre supported the project but the opposition party in
the state doesn’t want the project at the cost of society and
There was very contrasting view within the party.
CPI - Opposed from the very beginning. Their leader Abhay Sahu
established POSCO Pratirodh Sangram Samiti and organised rallies and
protests.
BJP - BJP showed its disinterest in this project. But it opposed the move
only after their separation from Government.
Views of different political parties

16. The Environment and Society

17. Environmental and Societal Concerns
Protests raised
over usage of
water from
Mahanadi & its
tributaries
Construction of
Port affects
drainage system
and causes
floods
land acquisition
leads to
deforestation
Emission of
harmful gases,
water pollutants
POSCO Port
affects lives of
fishermen and
marine

18. Illegal
occupancy of
agricultural
and forest land
Loss of self
sustained
society
Resistance,
agitations over
displacement
from mother
land
Govt. indulging
in violent
means and
human rights
violation

19. Skill
development
& training
Better
prospects for
employability
Better
technological
opportunities
Better access
to education
and health
Better quality
of life
Growth
oriented
economy
Perceptions of Pro-POSCO people

20. Which Way to go?