Steel ourselves

Posco,the South Korea-based steel giant,can finally go ahead with its 12-billion plant in Orissa,six years after it signed an agreement with the state government. On Monday,the ministry of environment and forests cleared the diversion of 1,253 hectares of forest land in Jagatsinhpur district,saying it had faith and trust that the state governments assurances that forest laws were not being broken were true. The worlds third-largest steelmaker is supposed to produce 12 million tonnes of steel a year at the location,in what is generally estimated to be the biggest single piece of foreign direct investment in India. The two conditions attached to the final clearance are not onerous,and also show,in their commitment to ensuring captive mines are not misused and to scientific reforestation,a long overdue change of mood from the Centre. Hopefully,now that the project has finally been given the go-ahead,the lack of investor confidence engendered by months of poor communication has been given the chance to dissipate.

The clearances were first handed out in January this year but after a committee appointed by the ministry asked that all the clearances be revoked. They were then delayed further when the ministry took note of petitions forwarded by activists working in the area,asking the state to respond; the Orissa government says it submitted evidence that the supposed gram sabha resolutions were illegal. This back-and-forth gave rise to many concerns of high-handedness and of political game-playing,an impression hardly commensurate with Indias status as a mature democracy. The environment and the law should not be seen to be used as counters in Centre-state politics.

What lessons should we learn from this episode? The most important is that when the government engages with investors and with stakeholders,it must be transparent and consistent. Another is that atmospherics matter. Evaluatory committees should be genuinely independent. And hold-ups should be defensible against charges of being politically motivated. Indias growth and its environment deserve no less. Lets learn these lessons,and move forward.