The much-awaited 12 million tonne steel plant of South Korean steel major Posco has to pass a litmus test in Supreme Court. Based on forestland diversification proposal of the Orissa government, the forest advisory committee has submitted a report in the apex court. Only if Supreme Court approves the proposal, can the 3,000 hectares of land be used for industrial purpose.

“The Centre has approved the diversification proposal of the state government, but Supreme Court would have the final say. We hope it will happen soon”, Soungsik Cho, chairman and managing director, Posco-India, told FE.

The Supreme Court on April 27, 2007, had ordered that any forestland diversification proposal in excess of 40 hectares required its nod before it was approved for other purpose. Based on the opinion of central empowered committee (CEC), a quasi-judicial body appointed by it, the apex court will judge whether the forest diversion clearance accorded by forest advisory committee is correct or not. However, Supreme Court is yet to finalise a date for hearing various diversification proposals including that of the South Korean giant.

Posco has identified a 4,004-acre land for its proposed plant, which is expected to cost Rs 52,000 crore. However, of the 4,004-acre land, 3,000 acres is notified as forest area. The forestland has to be de-notified for setting up the unit. The Orissa government has already sent a forestland diversion proposal to the Centre. Based on state government’s proposal, the forest advisory committee under the ministry of environment and forest has taken a decision and has submitted a report in apex court.

Meanwhile, Posco has started acquiring land for the project. It has already acquired 193 acres of government land and is in the process of acquiring another 300 acres of government land. The Korean company is also negotiating with villagers to acquire 438 acres of private land it needs for the 12 million-tonne project. To decide on the compensation package, the rehabilitation and periphery development advisory committee (RPDAC) is expected to meet shortly. The committee comprises representatives from the government, the company and the local people.