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Konkan’s reluctance to mega projects

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Nanar refinery is not a coincidence, Kokan’s rejection to projects is now become a visible pattern, writes Satvik.

With the cancellation of the Nanar super refinery project in March 2019, the list of megaprojects resisted by Konkan has only expanded. First, the Dabhol power plant (initiated in 1992), then the Jaitapur Nuclear Power Project (initiated in 2010), and now this.
The mega project at Dabhol aimed to provide electricity at a cheaper rate and was commenced by the then UPA govt through Maharashtra Power Development Corporation and American corporations Enron, General Electric, and Bechtel, but was muddled with controversies and corruption, from low-level positions to top officials in the Indian and American administrations. Late BJP leader Gopinath Munde, as Leader of the Opposition, opposed the project on grounds of pollution and corruption, vowing to “throw the Enron project into the Arabian Sea”. However, in 1995 when the Shiv Sena-BJP saffron alliance formed the government and he became the deputy chief minister, his policy changed. The Dabhol plant was built through the combined efforts of the above under the Dabhol Power Company (DPC). Thereafter, the power plant continued to run into troubles even after it began operation in May 1999.
The power project saw its first interruption due to the power purchase agreement between the DPC and the state’s power utility, Maharashtra State Electricity Board (MSEB). The agreement negotiation was done without transparency, and details had not been made publicly available. In 2000, the MSEB paid DPC Rs 4.67/kwh while the tariff that MSEB charged its customers was Rs 1.89/kwh implying a clear loss on the government’s behalf.
In January 2001, the Maharashtra government interrupted payments due to the unsustainability of the loss being incurred by the plant. High-level officials from the US tried to persuade the government to allow them to continue their operations at Dabhol but with escalating tensions between the MSEB, GoM, and DPC, operation of Phase I and construction of Phase II came to a standstill in May 2001. To further the complications, Enron declared bankruptcy in November 2001 and disputes between Enron’s creditors and the Government of Maharashtra (GoM) ensued. Finally, Enron’s stake in DPC was bought over by GE and Bechtel.
To stabilize the operation of the plant, the power plant was handed over to Ratnagiri Gas and Power (RGPPL), which continues to operate the plant today as a joint venture of GAIL, NTPC Ltd, Government of Maharashtra. Its three power blocks supply a combined total of 1967 MW of electricity to the Western Grid.
However, as of 2016, the power plant continues to operate at a loss, selling energy to the Indian railways at a highly inflated rate. In 2015, it had incurred a debt of Rs 10,500 crore. In a bid to revive the loss-making plant, in September 2015, the RGPPL was divided into two separate Power and LNG entities, one to manage the power plant and the other to supervise the import of LNG.

As far as the Jaitapur nuclear park of the Nuclear Power Corporation of India Ltd (NPCIL) is concerned, it was one of the most ambitious plans of the then Congress-led UPA government headed by Dr. Manmohan Singh, as nuclear energy falls directly under the purview of the Centre under the Union list. After 2014, the NDA government led by PM Narendra Modi had continued with the project. Yet, the plant has faced opposition from locals and political parties including the Shiv Sena. The protests, beginning in 2009, turned violent in April 2011, killing one man in a police firing.
The project aimed at installing 6 units of 1,650 MW power capacity – the total capacity being 9,900 MW – making it the biggest nuclear power complex in the world. It was deliberated in collaboration with a French company, Areva, which has now transferred its stake over to the Electricite De France (EDF). The total project cost was estimated to be around Rs 1 trillion or Rs 1 lakh crore.
The State government had placed the three mega projects within a 50-km radius, allowing for greater backlash from environmentalists and the Opposition.
Locals reacted to these by vehement opposition as well. On 29 December 2009, 12 January 2010, and 22 January 2010, when the government authorities visited Madban for distribution of cheques in lieu of obligatory land acquisition, the villagers declined to accept the cheques. Government officials were shown black flags and were obstructed from carrying out their activities. On 4 December 2010, protests became violent when over 1500 people were imprisoned from among thousands of protesters, who included environmentalists and local villagers. On 18 April 2011, one man was shot and killed by police and eight were wounded after protests turned violent.
These combined with the lack of clarity on The Civil Liability for Nuclear Damage Bill 2010 had made the EDF hesitant to continue with the project.
Environmental effects of nuclear power and geological issues have been raised by anti-nuclear activists of India against the JNPP. Since Jaitapur is a seismically sensitive area, the danger of an earthquake has been primarily on the minds of people. According to the Earthquake hazard zoning of India, Jaitapur comes under Zone III or the moderate Risk Zone (falling one category below Extreme Risk Zone). The presence of two major creeks on the proposed site was apparently ignored while clearing the site.
The government had not clarified where the nuclear waste from the site would be shipped for recycling or disposal. The plant was estimated to generate 300 tonnes of nuclear waste annually.
Since the plant would have used the seawater for cooling and then released warmed water in the Arabian Sea, fishermen believed that their occupation would be impacted adversely.
Social impact assessment review of the project by the Tata Institute of Social Sciences (TISS) suggested that the Government of India was not fully transparent with the citizens, and concealing massive negative impacts on the social and environmental development of the Konkan region in general. The government was also allegedly manipulating the area’s seismic risk level, lowering it from high severity earthquake zone to moderate seismic severity zone.
The protests and demonstrations proved to be a definitive obstruction in the path of the project’s manifestation and as of February 2020, have left no clear path for the project insight.

Lastly, the controversial Nanar super refinery project, which was to be the largest refinery in India, was recently held back due to similar protests by locals backed by Shiv Sena. It is humorous to note that Shiv Sena made the project’s cancellation a precondition for its alliance with the BJP in Maharashtra’s polls.
The project came to be through an MoU signed, in April 2018, between Saudi Aramco and the three PSUs —Hindustan Petroleum Corporation Ltd (HPCL), Bharat Petroleum Corporation Ltd (BPCL) and Indian Oil Corporation (IOC) — to develop an integrated refinery and petrochemicals complex at Nanar village in Ratnagiri district, Maharashtra. IOC was the lead partner with a 25% share while HPCL and BPCL will hold 12.5% each.
The proposed capacity was 60 million tonnes per annum, which was over 70% more than the 35 million tonnes of Jamnagar refinery, currently India’s biggest refinery. It also would’ve had the capacity to employ 20,000 employees once functional.
The project was canceled following severe opposition from locals and while scrapping the project, the government cited damage to nature, environment, farming, and orchards, as its reasons for the same.
However, even the cancellation of this project saw protests from various other local groups such as the Konkan Vikas Samiti and the Konkan Janakalyan Prathistha.
Keshav Bhat, a local resident, and spokesperson of the Konkan Vikas Samiti told the media that development and jobs were paramount in Ratnagiri and concerns regarding pollution were unfounded and spread by vested interests. He cites the provision of one lakh jobs for the construction of the complex for five years and 20,000 permanent jobs once the refinery and the petrochemical complex were operational.
The refinery was planned to be a zero discharge refinery, therefore the fears of marine pollution were indeed unfounded; Mumbai has two such refineries, whose health hazards have not been established.
In Ratnagiri district, mango farmers were willing to give their land because mango farming was no longer economically viable to many. The refinery would have created huge opportunities for the local business communities, as several migrant laborers would’ve immigrated to Ratnagiri.
Former CM Devendra Fadnavis had announced for the refinery to be shifted to Nagpur due to its central location in the peninsula allowing for drastic cost reduction in supplying oil to neighboring states. Yet, with the transfer of power to the Maha Vikas Aghadi, led by CM Uddhav Thackeray, the project has halted almost entirely with no certainty regarding the future of the same.

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