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Politics & Economics: Posco Says Tumult Won't Halt Plans for Steel Facility in India

Peter Wonacott. Wall Street Journal. (Eastern edition). New York, N.Y.: May 14, 2007. pg. A.6

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"We have a positive hope that we can convince them to sell the land," said Gee-Wong Sung, the head of the steelmaking project for Posco-India, a unit of the world's third-largest steel company by output. "But if they don't want to sell," he said, "we can't force them." The protesters escorted Mr. Das and the two other Posco employees to the village of Dhinkia, the heart of a movement opposing the project. A female Posco employee was quickly released. But the two men weren't let go until early Saturday morning, after they signed a statement promising not to return, according to Mr. Das and the leader of the anti-Posco movement, Abhaya Sahoo.

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(c) 2007 Dow Jones & Company, Inc. Reproduced with permission of copyright owner. Further reproduction or distribution is prohibited without permission. NEW DELHI -- Irate villagers who briefly detained three Posco employees during the weekend in India's eastern state of Orissa won't deter the South Korean steelmaker from efforts to buy land in the area for a $12 billion project, a senior Posco executive said. "We have a positive hope that we can convince them to sell the land," said Gee-Wong Sung, the head of the steelmaking project for Posco-India, a unit of the world's third-largest steel company by output. "But if they don't want to sell," he said, "we can't force them." Posco aims to acquire about 4,000 acres of land to build a facility able to produce 12 million metric tons of steel a year in what would be one of the biggest foreign investments in India. The plant is to be linked to the world with new roads, bridges and a dedicated seaport. Iron ore, the major steelmaking ingredient, will come from nearby mines. But the government's drive to acquire more rural land for both industrial projects and newly formed special-economic zones has sparked a series of violent incidents. The protests have forced the central government to re-evaluate some of its policies for acquiring such land, and it now encourages companies to negotiate with rural residents directly instead of purchasing property for them. Posco's plans represent a high-profile test of that new policy. Three Posco employees were visiting the proposed project site Friday afternoon when their car was surrounded by villagers wielding bamboo poles and a window was smashed, according to Choudhury Pranavananda Das, a public-relations executive with Posco and one of the three who was detained. The protesters escorted Mr. Das and the two other Posco employees to the village of Dhinkia, the heart of a movement opposing the project. A female Posco employee was quickly released. But the two men weren't let go until early Saturday morning, after they signed a statement promising not to return, according to Mr. Das and the leader of the anti-Posco movement, Abhaya Sahoo. "We told them that this was between the government and the people," Mr. Sahoo said in a telephone interview. "Why did they have to come?" Posco's Mr. Sung denied that the incident might prompt the company to abandon its plans to build in the area, though he said it is considering its options. No arrests have yet been made in connection with the incident, according to Y.K. Jethwa, the superintendent of police for the Jagatsinghpur district. Enlarge 200% Enlarge 400%