Delay in Posco, ArcelorMittal proj a national loss

Steel Minister Virbhadra Singh regretted that India failed to capitalise on Rs 1.5 lakh crore projects proposed by giants like Posco and ArcelorMittal and termed it a "national loss".

"I am personally sorry about it. I think this is a national loss," Singh said regretting that such mega plans are being dealt with "in a routine manner" in the country.

"We should take special steps to see that all the procedures, which are to be done are done expeditiously. The projects have been delayed...our production capacity could have further increased. We suffered a loss of 36 million tonnes (MT)," he said.

Both Posco and ArcelorMittal's projects are stalled for over five years now with the Environment Ministry's nod awaited for the former while the steel majors face multiple problems like delays in land acquisition and protests.

Saying he is passionate about such projects, Singh said both Posco and ArcelorMittal had shown their keenness to set up big projects but "their projects have been delayed" despite concerns by the highest levels that included Prime Minister's office.

"We want all hurdles to be removed as per the law," he said adding, Posco project was in the interest of Orissa government too as " it is the biggest foreign direct investment of Rs 54,000 crore."

The domestic steel industry, which has an investment of about Rs 11 lakh crore in the pipeline, faces multiple challenges like green clearances and tribal protests, besides delays in allocation of iron ore and coal mines to feed projects.

South Korean Posco had entered into an agreement with Orissa in 2005 for setting up a 12 MTPA plant, but is facing problems in green nod for Rs 54,000 crore project, billed as the single largest FDI in the country.

However, the Environment Ministry in August had asked POSCO to halt all work at the project, including the land acquisition, while a panel investigated whether forest laws were violated.

Last month, the forest panel had recommended temporary withdrawal of existing permits. Environment Minister Jairam Ramesh had said yesterday that a final decision on POSCO's project in Orissa will be taken by end-January.

Earlier, peeved by delays in clearance to Posco project, Singh had asked the Environment Minister Jairam Ramesh to have a pragmatic and not dogmatic approach.

"I am very much concerned at the delay (in getting clearance to Posco and other projects)...Where ever the land acquisition and environment clearance is concerned the projects are piling up," he had said, attributing the delays to the opposition by activists-led environment ministry panel.

Similarly, the world's largest steel maker ArcelorMittal had entered into an pact with Jharkhand government in 2005 and a year later with the Orissa government to set up plants of 12 MTPA, each at a total investment of about Rs 1 lakh crore.

Faced with protests, ArcelorMittal was also forced to shift plans to set up the project in Bokaro from Khunti-Gumla in Jharkhand.

The steel ministry envisages a production capacity of about 120 million tonnes per annum by 2012, an ambitious target considering the present capacity of about 74 million tonnes only.