SC nod pulls the spanner off Orissa’s big ticket projects

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New Delhi, Aug 11 : The Supreme Court’s decision to permit South Korean steel major Posco to go ahead with its steel project in Orissa has paved the way for the biggest foreign direct investment (FDI) project in the country to get underway. Similarly, giving its accord to Vendanta’s plans has put on tract a project that has been stuck for some time due to opposition from local community in Orissa and from environmentalists. With the permission to start operations, the two companies join world largest steel maker ArcelorMittal in moving ahead with investment worth $12 billion. ArcelorMittal itself has a $20 billion investment plan in Orissa.

Land acquisition okayed, Posco to start construction soon

With the Supreme Court clearing the Posco project, the South Korean steel major now can start construction work on its 12 million tonne steel project in the state.

Posco requires about 4,004 acre for the steel project at Paradip, in Orissa’s Jagatsinghpur district. Of the 4,004 acre, forest diversion approval is required for 2,958.79 acre. Out of the rest, 607.71 acre come under non-forest government land and 437.68 acre under private land. The Centre has allotted 193.55 acre to Posco-India. However, Posco could not use the land as it was found to have been recorded as government land. So, the government had to move the ministry of forest and environment and subsequently the Supreme Court for diversion of forest land for the purpose of industrial use.

Posco-India, which has signed an MoU with the Orissa government to set up the 12 million tonne steel project, besides captive port and mining projects with a total investment of $12 billion, is finding it difficult to acquire land in the Paradip area. It had set a deadline of April 1, 2007, to start land preparation work on the government land given to it. But, it could not start work as the land was found to be recorded as forest land.

Now, with the apex court giving its approval for the diversion, Posco will now be able to start land preparation work on the site, said a senior company official. According to the revised work schedule, Posco is now proposing to start construction from September with the aim to commission the first phase 4 million tonne plant by 2010, the official said.

ArcelorMittal starts process of land acquisition