Governance Now, Dec 1-15, 2010
By going in for the moneybag brand of development at the cost of what people need or prudence demands, Orissa is fast turning into a basket case and is all set to replace Bihar in the ‘bimaru’ club
When you head towards Ersama block (which bore the brunt of the Supercyclone of 1999) in Jagatsinghpur, about 100 km from Orissa’s capital city of Bhubaneswar, you are immediately struck by the light green paddy fields stretched for miles on either side of the road, skirted by tall dark green trees at the far ends. The air is clean, the surroundings refreshing. Mahanga river, which has been parted at several places to mark exclusive fishing areas for the villages, gives you company some way to the cluster of villages that those tall dark trees hide in their midst. Cattle egrets and an occasional drango make their appearances to complete the picture of a calm, peaceful and pleasant rural set-up. Once there, you expect a chirpy village life waiting to greet you. Instead, you are hit by an eerie silence so conspicuous that you suddenly realise you are in a condemned zone. Several villages falling under three panchayats – Dhinkia, Gada Kujanga and Nuagaon – are living under constant fear. The government is determined to acquire 4,000 acre of their homestead and farmland for a South Korean steel company, POSCO.
What the villagers fail to understand is why the government is bent on throwing them out of their forefathers’ land and destroying their lives by giving away their land to a foreign company when, three km down south there is plenty of barren land that can be used for the same purpose. Shifting the location of POSCO’s plant will not mean much inconvenience for the company except for levelling the sandy shore of the Bay of Bengal. Of course, the government never consulted them nor responded to the suggestion about shifting the plant site.
Incidentally, they are still recovering from the Supercyclone that killed more than 8,000 in this block alone and washed away several villages. They got paltry sums between Rs 1,000 and Rs 3,500 for the houses damaged or washed away. Then came an IOC refinery (in Abhaychandpur village) for which hundreds lost their homes in 2001 but the rehabilitation site remains barren even today.
What People Need
“Given a choice, what kind of development you would like for your area?” I ask one of the villagers, Ranjan Swain of Govindpur village in Dhinkia – a 30-year-old betel vine grower who has turned a full-time anti-plant activist. Here is what he said: “I would like a cashew processing plant in our area. We produce about 200 tonne of cashew a year which is sent to Kolkata for processing. The processed product then comes back to Cuttack for sale in and outside the state. My second wish would be nurseries for fish and prawn that grow so well in salty waters of Mahanga and Jatadhar rivers and our ponds. Right now, we get the hatchlings from Hyderabad. My third wish would be export facilities for excellent ‘banarasi’ paan (betel leaf) that only we grow.” He also points out how government apathy in the past led to closure of two textile mills in the district in 1990s as a result of which the villagers stopped growing cotton altogether.
His sarpanch, Shishir Kumar Mahapatra, adds a few to the list: Roads, maintenance of a cyclone shelter built by the Maharashtra government in 2000, power connections to homes and a public health centre.
Nearly 600 km southwest of Bhubaneswar, in Kashipur block of Rayagada district, the situation is no different. Kashipur has been in news for all the wrong reasons – starvation deaths of 2001 (when many succumbed after consuming infected mango kernel) and resistance to bauxite mining and alumina plants. This is among the most picturesque places of Orissa with green hills covering the entire region, some of which carry bauxite. Some would go to the extent of comparing its natural beauty with that of Kashmir. Primitive Kondhs and Parajas live at the foothills and practice jhum cultivation because of which many of the hills are now barren. Vidhya Das of Agragamee, a non–government agency, has been working among these tribals for more than quarter of a century. I ask her the same question that I had asked Ranjan Swain.
In response, Vidhya says communication and livelihood issues bother her the most and need fixing. There are no roads in this block. Bits of tar one finds give an impression that the roads were laid 10 to 20 years ago and never been re-carpeted since. There are only two private minibuses that connect it to nearby district headquarters. Villagers walk for 5, 10, 20 even 30 km on foot every day. Some cross the hills wherever possible. As for livelihood issues, the tribals practice jhum that involves clearing up hills to grow rice, millets and oil seeds. They grow only one crop, Kharif, as there is no irrigation. Productivity is low and people let their cattle roam free for rest of the year. Vidhya would like the government to promote “settled” agriculture by helping with irrigation, watershed and land reclamation programmes. Poor marketing avenues deprive people good return on their products. This forces them to cut more trees to generate cash. Panasguda, the village that had witnessed mango kernel-related deaths in 2001, has no source of income other than selling wood though it is located one km away from the Kashipur block headquarters. The hills surrounding the village are without a tree. They now cross over to cut wood from the other side.
There are other issues. Malaria, cholera and diarrhoea claim a steady stream of lives throughout the year. The block has seven PHCs and one community PHC. According to the local block development officer (BDO), none of the PHCs has a doctor and the community PHC has two, instead of seven.
Instead of fixing these issues to improve the living conditions, the state has focused on handing over hills, villages and farmland for bauxite mining and alumina plants by coercion and allurement. Some of the anti-mining leaders have, thus, turned contractors and work for setting up Utkal Alumina’s plant and its mining of the Baphlimali hills. Thousands have been displaced on account of this. Those who continue to resist face criminal cases and are forced to stay away. Aditya Birla is coming up with another alumina plant and will mine the Sasbahumali hills. Vedanta’s original plan was to set up its alumina plant here and mine these hills but it was forced to shift to Kalahandi and seek the Niyamgiri hills. The protests may have subsided but anger and resentment simmer.
I did two more such exercises, one of which was in Kalinganagar in Jajpur district, 100-odd km northeast of Bhubaneswar and another conflict zone. People of Chandia and Gobarghati panchayats, who are Ho and Mundari settlers from Chhotanagpur plateau of Jharkhand, are facing eviction for a steel plant by the Tatas. Their leader Ravindra Nath Jarika says the land is fertile but requires irrigation for the second crop. The area needs a PHC, upper primary and high schools, teachers, doctors and NREGA work which was never taken up because these villages have been out of bound for the government officials since 2004 and witnessed a cold–blooded killing of 15 tribals by police in January 2006.
What Prudence Demands
It is quite apparent that there is a huge gap between what the people need and what the state is doing by way of so-called development and this is at the heart of conflicts in many parts of the state. A few facts about the state will make it easy to understand and find solutions to these conflicts which often turn violent.
“Orissa is an agrarian state” goes the first line of the state agriculture policy of 2008, adding that 83 percent of the farming community consists of small and marginal farmers. Latest economic survey (ES) report says though agriculture and allied sectors contribute less than 30 percent towards the state’s GDP it engages 60 percent of state’s workforce (2001 census said 70 percent). Both, however, ignore a huge and growing population of migrant workers to Andhra’s brick kilns, Surat’s textile and diamond units, to Raipur, Delhi, Mumbai, Bengaluru and elsewhere for other menial jobs.
The state has rich forest cover (more than 37 percent) and mineral resources too, especially in the backward and tribal dominated districts. These districts grow plenty of rice, millets, fruits like mango, guava and banana, medicinal plants, bamboo, cardamom, oilseeds and so on. The mineral resources include iron ore, bauxite, coal, copper, manganese, nickel etc.
Given the spread and dependence on agriculture and forests, it would seem logical for the state to focus on these areas, except that it doesn’t. The state’s focus is only on mining and mining-related industries for the past decade and more – the kind of activity that holds special attraction for the moneybags and their brand of development. If it means displacement and destruction of thousands of lives, so be it! Any wonder that 17 of 30 districts in Orissa are Maoist-hit?
Moneybag Development
Ever since sparkling-clean Naveen Patnaik came to power in 2000, his government has signed 87 MoUs for setting up industries. Not a single of these is related to either agriculture or forest. The MoUs are primarily for steel, power and alumina plants. About 30 of these have materialised but all the big-ticket projects (that of POSCO, Tata, ArcelorMittal, Jindal) are stuck due to protests. But the protests have made no difference.
When I asked industry minister Raghunath Mohanty why not one MoU is for agro or forest-based industry, he said, “We have an open mind.” When I asked why the state took no initiative to set up such industries, he was irritated and said, “But I told you the government has an open mind and if anybody comes forward, we will welcome it.” As for why the state is bulldozing its way through by denying people forest rights (which is the case in Ersama, Kashipur, Kalinganagar and elsewhere) he was quite emphatic that “they (people seeking forest rights) have no such rights; we told this to Jairam Ramesh.”
Agriculture minister Damodar Rout concedes that the state’s priorities are wrong, after having dismissed it initially: “You are right. We don’t have a sound agro-based policy. Now we are planning to do that.” What forced his hands is damning evidence – that all agro-based industries, save for three sugar mills, have been shut or become defunct in the past one-and-half decades and the state has no plan either to revive or set up new ones, as of now.
Agriculture production has remained stagnant for years. Latest government records show except for 2001-02 and 2007-08, all other years between 1998 and 2009 saw deficit foodgrain production (see boxes). Worse, land under cultivation is shrinking (from 45 lakh hectare in 2001-02 to 44 lakh in 2007-08 as per Economic Intelligence Service report of 2010).
Former finance minister Panchanan Kanungo (between 2002 and 2004 in Naveen Patnaik’s government) presents a stark picture of a lop–sided approach. He says all of 18 textile mills, one jute mill, eight oil mills, three of seven sugar mills and one of three fertilizers plants have closed down or become defunct in the past 10-12 years. Of course, there are no forest-based industries to make use of fruits, bamboos, kewda, medicinal plants and so on.
Irrigation has shrunk. Latest ES report says “irrigation intensity” has gone down to 31 percent, from 46 percent (ES 2004-5). This is an alarming situation and makes the state more of a one-crop wonder in spite of scores of rivers, mountain streams, plenty of easily accessible groundwater and a healthy rainfall of 1,450 mm a year. The ES concludes that “lack of irrigation still remains a major stumbling block on enhancing agricultural productivity”.
In such a situation, crop insurance comes handy. In early years of his term, Naveen Patnaik made gram panchayat (GP) as the basic unit to consider for relief in case of drought/crop failure (benchmarked at 60 percent damage). This was changed a year later to make the “block” as the base unit (one block may have 12 to 25 GPs), thereby depriving a lot of farmers from drought/crop failure relief. State’s agriculture secretary UP Singh says reverting to the block as a unit is being contemplated.
Add poor seed supply (“seed replacement rate” for rice, the main crop, is only 10 percent) and fertiliser, both chemical and organic, (half the national consumption) and you stare at a desperate situation.
But that is not all. Other support systems are bad too. Kanungo says, as per the official records, of 52 lakh agriculture families in the state only 24 lakh get farm credit (15 lakh from cooperative banks and 9 lakh from other banks), thus leaving more than 50 percent at the mercy of microfinance companies and moneylenders. Even when farmers get loan, it is used mostly for sustenance. Agriculture secretary concurs: “Actual use for agriculture is very small.”
Food procurement (confined to paddy only), which the state began in 2003-04, remains erratic with frequent protests and road blockage in western districts and distress sell in southern ones because of complete lack of any marketing facility.
Kanungo says, in his assessment Orissa spends about Rs 2,500 crore every month in importing wheat, pulses, oil, milk and milk products, potato, onion, fish, eggs etc. because of the lop–sided policy of the state government.
His conclusion: “Initially, the Naveen Patnaik government put some emphasis on agriculture. But the focus shifted to mining–linked industries in the next two terms. Past mistakes are being repeated by Naveen.” Patnaik is in his third term and Kanungo refers to past CMs of Orissa, who, save for Nabakrushna Choudhury, seemingly took little interest in rural economy and agriculture.
Land distribution is another key reason for poor agriculture. As 83 percent farmers fall in small and marginal farmers and tenancy is widely prevalent, little by way of technology or input goes into farming (officially, the state’s agriculture is described as “subsistence agriculture”). The Orissa Land Reforms Act of 1960 attempted to give “land rights” to the tenants but it harmed more because, as Prof Mamata Swain, economic professor of Ravenshaw College, says, it led to tenants being thrown out even at the cost of keeping land fallow. On the other hand, Bengal’s Operation Barga, introduced in late 1970s, sought to protect “tenancy rights” and achieved remarkable success before its decline. Subsequent attempt to redistribute Bhoodan land and land in excess of ceiling failed because of poor implementation. A 2008 study by UNDP said: “The ceiling surplus operation failed to yield the desired result because of lack of actual physical possession by the beneficiary, unavailability of records of rights and poor land quality making it impossible for the beneficiaries to cultivate the land.” As for Bhoodan land, it said the land either remained undistributed or were re-occupied. A 2007 drive, My Land and My Homestead Land, too failed to ensure possession, the report said.
Look at some other related issues. The state has not added a unit of power in decades and T&D loss remains 65 percent in spite of the fact that Orissa was the first state in the country to reform transmission and distribution functions way back in 1990! Only 22 percent rural households are electrified (as per ES) and power consumption for irrigation “is in declining trend” (departmental “status” report).
Orissa’s GDP growth (“advance estimate” for 2009-10 says 8.35 percent) is slowly catching up with the national growth rate largely due to the mining-related industrial activities. But this is not an unqualified success story. ES says cottage industry has fallen by 50 percent since 2000-01. Of 4,806 micro, small and medium enterprises (MSME) units, 1,690 have gone sick by 2008-09. Thirty-two PSUs have been closed and of the other 32 PSUs, nine are either loss making or running on no-profit-no-loss basis.
As for mining, more than 60 percent of licences are illegal, as the apex court-appointed central empowered committee pointed out in its report in April this year.
Therefore, poverty endures. ES provides a measure of it. Orissa remains at the bottom of the country-wide list in per capita expenditure in rural areas and fourth from the last for the same in urban areas (as per 2006-07 NSS data).
An enquiry commission headed by Justice (retd) SK Mohanty, which looked into regional imbalances and submitted its report in 2008, made several telling points. It said 14 districts fell under ‘backward’ or ‘very backward’ category in agriculture and asked for urgent steps to provide irrigation, agro-based industries, agriculture credit, seed supply, technical guidance and marketing facility to improve production and stop distress selling in those districts. It also said 15 districts were industrially ‘backward’ or ‘very backward’ and pointed out how industries required to spend a part of their profit in “peripheral development” (in lieu of concessions like “free/cheap land, cheap electricity and water”) were actually spending in “urban areas including improvement of government buildings”. As for infrastructure, it said all indicators like road and electrification were low in those districts.
This report has not received the importance it deserves. In fact, one road being built in Kashipur (a rare sight!) under the PMGSY is actually meant to connect Utkal Alumina’s plant to its mining site and so passes through largely empty land.
No wonder, Orissa continues to remain a laggard. The latest India Today magazine’s “State of States” report keeps Orissa at number 15 in the overall ranking for performance among 20 big states. In investment environment and macro economy, the state is placed at 14 and 15, respectively. Be it agriculture (17), consumer market (19), primary education (14), infrastructure (15), governance (17) and primary health (16), the state is in the bottom pile. Bihar, though placed lower, has been termed the “turnaround champ”. No such hope for Orissa yet.
In fact, when I first met former finance minister Kanungo in Bhubaneswar and introduced myself as a reporter from Governance Now, his opening remark was: “You have come to a place where governance is missing.” Ranjan Swain, Vidhya Das or Ravindra Jarika won’t really disagree with that view. n
prasanna@governancenow.com
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