JSPL opposes steep upfront fee proposed on water allocation

Jindal Steel & Power Ltd (JSPL) has voiced its opposition to a proposal by the state water resources department to fix an upfront charge of Rs 2.5 crore per cusec of water allotted for industrial units.

Stating that such a steep fee on water allocation for industries is unprecedented and is not levied by any other state, the steel maker has said the move, if implemented, will send a very wrong signal for industries and dent Odisha's image as an investor friendly state.

"We have objected to the move of imposition of upfront fee of Rs 2.5 crore per cusec on water allocation. In any case, the water resources department has stipulated some conditions as part of its water conservation policy wherein the industries are required to build dams and barrages to prevent waste of water. What we have demanded is that either these conditions are removed or the proposed upfront fee is not imposed as complying with both is not tenable”, said a top executive of JSPL.

"No state is charging such an exorbitant upfront fee on water allocation. The industries, operating in the state, are already paying steeply following the last increase in water cess by the state government”, he added.

When contacted by Business Standard, Suresh Mohapatra, principal secretary (water resources) said, “The proposal for imposing upfront fee on water allocation for industries is very much there. But it is premature to disclose anything as the proposal is yet to be approved.”In August 2010, the State Cabinet had hiked water cess for industrial use by 100 per cent. The state was collecting around Rs 400 crore every year by way of water cess.

The move to hike water cess had not found favour with industries who had termed it 'unjustified'.Meanwhile, the state government was making frenzied efforts to recover Rs 1634.71 crore of water cess pending on 251 industries including big corporate players like National Aluminium Company (Nalco), Tata Steel and Paradeep Port Trust (PPT).

To recover water dues from the errant players, the state government has fixed two per cent compounded interest per month on arrears and issued demand notice for payment of water tax at regular intervals.

This apart, Enforcement Squad has been constituted under the chairmanship of the Chief Engineer to recover the dues from the industries.Contesting the demand raised by the state government, 16 industries had filed cases in the Odisha High Court.

These industries are Nalco-Angul (Rs 112.75 crore), Nalco-Damanjodi (Rs 27.04 crore), Tata Steel (Rs 3.39 crore), Tata Refractories (Rs 8.83 crore), Steel Authority of India Ltd- SAIL, Rourkela (Rs 1121.30 crore), Jayashree Chemicals Ltd (Rs 2.59 crore), Aska Cooperative Sugar Industries Ltd (Rs 12.65 lakh), Ganon & Dunkerely Co Ltd (Rs 1.22 lakh), J K Corporation-Rayagada (Rs 1.26 crore), South-Eastern Railways (Rs 14.70 crore), Ballarpur Industries Ltd-Choudwar (Rs 40.40 crore), Sakthi Sugar Ltd (Rs 2.17 crore), Orissa Synthetics Ltd (Rs 5.98 crore) later taken over by Reliance Industries Ltd, Ballarpur Industries Ltd (Rs 79.29 crore), PPT (Rs 2.12 crore) and IFGL Refractory (Rs 46,000).