A study of disputes between POSCO and local communities on POSCO's steel mill development in India

Abstract

The purpose of this study is to analyse the problems that exist between local communities and Pohang Iron and Steel Company (POSCO) due to POSCO's large-scale steel mill establishment in India, and to draw strategies to solve the problems. Local communities have been opposing the project due to fears of denuding the forests, displacement of residents, less economic opportunities for local people, etc. Thus, the progress of the project is very slow, even with strong support from the Indian government. To gain favour with the local community and to promote the project successfully, POSCO must be equipped with effective local-friendly programmes and non-hostile cooperative negotiation strategies founded on mutual trust. Also, community outreach for explaining such large-scale issues as national economic multipliers and sustainable development must be performed by POSCO and the Indian government. It is recommended that POSCO establish a conflict resolution committee consisting of interested parties, as well as appoint a third-party mediator. It is important for POSCO to maintain a long-term, comprehensive view when initiating a project in India or other similar countries.