The government is not opposed to Posco getting a majority stake in the proposed about Rs 12,000-crore (Rs 120-billion) joint venture between the South Korean giant and state-run SAIL, Steel Minister Virbhadra Singh said on Monday.

"In principle, we are not opposed to giving a majority stake to Posco in the joint venture, for which we will be seeking a Cabinet approval in a couple of months," the minister told reporters on the sidelines a summit in New Delhi.

Steel Authority of India Limited and Posco are in discussions to set up a 1.5 million tonne integrated plant in Bokaro to produce high grade steel from low-grade iron ore and non-coking

"The agreement between the companies is expected in the next two-three months," Singh added.

Steel ministry officials had earlier said that the plant, to come on about 2,500 acre land within the premises of SAIL Bokaro Steel unit, could cost about Rs 12,000 crore.