NEW DELHI, Oct 19: India’s communists on today warned Prime Minister Manmohan Singh against allowing land grabs in eastern India for steel giant Posco’s proposed plant. The South Korean company’s plans to invest in a $12 billion steel hub in the state of Orissa have been stymied by opposition from villagers who say they will be unable to earn a living if they lose their land to the project.

“It is reported that the bosses of Posco have now approached you in this matter,” said A.B. Bardhan, a senior communist leader, in a letter to the prime minister.

“Any repressive action to force acquisition of land for the steel project could be counterproductive,” he wrote, according to a Press Trust of India news agency report.

India’s communists, key allies of the ruling Congress party, appear to be trying to influence policy with new vigour after apparently forcing the government to back away from a controversial nuclear deal with the United States.

Now they appear to be taking on the government’s policy to encourage infrastructure investment by handing over swathes of rural land to private companies as tax-free havens for industrial projects.

Bardhan said the villagers’ opposition to the project was “justified” and acquiring the land by force would lead to a “bloodbath,” the PTI report said.

“Tension is now mounting because of the threatened police action to help Posco forces enter into the area. Contingents of police have surrounded the area and preparations are going on for this purpose,” he warned.—AFP