Thursday, April 08, 2010

How Naxal violence hits India Inc hard

Sonal Joshi
CNN-IBN


HITTING HARD: Naxal violence is taking a heavy toll on Corporate India.
New Delhi: Naxal violence is not only hitting the government where it hurts. It is also damaging corporate India's investment and development plans. Naxal violence is concenterated mainly in the mineral rich area of the country where most of India's iron ore, coal, bauxite and limestone are found.
But none of these mineral riches can be exploited fully as Naxals regularly target factories, mills and mines. Coal India, Nalco, NMDC, SAIL, Essar Steel and Tata Steel have operations in the eastern states those are affected by Naxal violence.
In the past, National Mineral Development Corporation (NMDC) posted a 40% decline in third-quarter profit after a slurry pipeline was damaged by Maoists. Future also looks grim. Jindal Steel had earlier planned to build a steel plant in the state but now the company is sceptical about the move. Joint Managing Director Seshagiri Rao says, "the attacks have made corporates re-think on setting up projects in Chhatisgarh."
At present, a whopping 130 billion rupees are stuck in power and steel industries in the region. Essar's iron ore plant has been targetted several times and the company is losing about 2 crore rupees every day. Tata Steel has not completed its Chhattisgarh steel plant while NMDC's plant has also been targetted. Steel Authority of India's mines too were attacked.
And even as lives and li

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