New Delhi (Sputnik): India's ambitious bid to set up one of the world's biggest oil refinery has suffered a huge setback following massive protests by local farmers in the state of Maharashtra where the refinery was proposed to be built in partnership with Saudi Arabia' oil consortium Saudi Aramco at a cost of $44-bn.
The protesting farmers fear that the refinery would negatively impact farm produce like the famed Alphonso mangoes, cashew, and other seafood.
Fearing an electoral fiasco over the project in the face of elections, Chief Minister of Maharastra Devendra Fadnavis announced that the land acquisition process for the project is being stalled.
"The entire (land acquisition) process has been stayed. We haven't acquired any land," Fadnavis told the state assembly amid an uproar by opposition lawmakers.
The refinery was being projected by the Indian government as a milestone in its energy security with a symbiotic partnership with Saudi Arabia. It offered India steady fuel supplies while giving Saudi Aramco a regular buyer for its oil with an unstable oil economy at the backdrop. The Indian government had even launched a massive media campaign to announce the venture in April.
"The place which the government chose for the project was a wrong decision. This place is a fertile farm of one of the world's most precious Alphonso mangoes and cashews. My understanding of the situation is that the government is only trying to control the situation for a while by halting the process. Justice to farmers is still awaited," Dushyant Nager, agricultural workers' union leader told Sputnik.
Its fertile coastal land and government must understand the vitality of ecological wealth before thinking of industrialization, he added.
RRPL — the joint venture of the Indian Oil Corporation and Hindustan Petroleum with the Saudi Aramco had earlier announced that the refinery would be capable of refining 1.2 million barrel-per-day (bpd) of crude and an integrated petrochemical site with a capacity of 18 million tonnes per year would help create direct and indirect employment for up to 150,000 people.
"Issues related to the land for the refinery will be sorted out by the state government soon given the importance of the project," RRPL Chief Executive officer B. Ashok told Reuters.
"The development is not healthy. The state government seems to have acted in haste due to public pressure. It will send a very wrong impression with the foreign investors in India. We are hoping that constraints would be sorted out soon," a consultant with the Petroleum ministry of India and a former bureaucrat told Sputnik on condition of anonymity.