Odisha, Posco agree to set up 8 mtpa steel plant

Bhubaneswar: Odisha government and Posco- India today agreed to set up an 8 mtpa greenfield steel plant near Paradip, downsizing the earlier plan of establishing a 12 mtpa facility. This was stated by Chief Minister Naveen Patnaik and Posco-India CMD Y W Yoon after a marathon 90-minute discussion over the future of the proposed mega steel project which had been hanging in balance for last seven years.

"We will start the project work as soon as the state government hands over 2,700 acres of land for setting up of 8 mtpa steel plant," Yoon told reporters. The company had so far been given only 500 acres of land for the purpose though the government claimed to have acquired about 2,000 acres, he said.

Posco-India which had proposed to set up a 12 mtpa steel plant near Paradip at an investment of Rs 52,000 crore, said to be the biggest FDI in the country, had failed to pick up due to various issues including stiff resistance from locals under Ersama block of Jagatsinghpur district.

The state government and the company had signed an MoU on June 22, 2005 to set up a 12 mtpa plant. However, both the parties agreed to downsize the capacity as the required 4,004 acre of land could not be acquired due to opposition from locals. Asked about the company`s revised investment plan for the 8 mtpa steel mill, Yoon said "Our investment plan remains unchanged. However, we will review the cost as the construction proceeds."