The Hindu Business Line : Kakinada farmers oppose land acquisition for SEZ

THE ambitious project of the State Government to set up an oil refinery and special economic zone (SEZ) near Kakinada has run into difficulties, as the farmers and farm workers in the area are refusing to part with their fertile land.

The two projects, for which the State Government has signed a memorandum of understanding with the Oil and Natural Gas Commission (ONGC), require 10,000 acres. The proposed refinery, with an annual capacity of 75 lakh tonnes, is to be set up at a cost of Rs 5,500 crore.

The initial investment in the SEZ is estimated at Rs 1,500 crore.

The Andhra Pradesh Industrial Infrastructure Corporation (APIIC), the nodal agency, will have a 3 per cent equity participation in both the projects.

In the proposed refinery, Mangalore Refinery Public Ltd (MRPL) will have a stake of 26 per cent, ONGC 20 per cent and the Infrastructure Leasing and Financial Services Ltd (IL&FS) 51 per cent (besides the three per cent stake of APIIC.)

In the proposed SEZ, MRPL will have a 26 per cent stake, ONGC 20 per cent and APIIC three per cent.

The rest (51 per cent) is to be contributed by the IL&FS and the Kakinada Seaports Ltd, the private consortium managing the Kakinada deepwater port.

The State Government is keen on pushing through both the projects quickly, but farmers in the villages are not willing to part with valuable land yielding two crops a year.

The land, which has a high value due to its proximity to Kakinada, is irrigated by the Pithapuram branch canal (Godavari canal).

A proposal has been floated to shift the refinery and the SEZ to the Thondangi mandal in the uplands, but the ruling Congress party is divided on this issue.

The MLA of Kakinada, Mr M. Gopalakrishna, is stated to be keen on having the projects near Kakinada, but the other leaders in his party oppose it. The issue has acquired political overtones, with the Telugu Desam leader and former finance minister, Mr Y. Ramakrishnudu, opposing the shifting of the projects to Thondangi mandal, which falls within his constituency (Tuni).

Amidst all these pulls and pressures, the State Government is yet to announce its final decision on where the two projects will be situated.

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