As a direct fall-out of the iron ore mining scam in Karnataka, pig iron manufacturer Tata Metaliks Limited might have to close down its Goa plant in a week, a top company official said on Tuesday.
"The iron ore supplies to the Goa plant is halted due to the Supreme Court ban on mining in Karnataka. We may have to close down the plant in a week," Managing Director of Tata Metaliks, a subsidiary of Tata Steel, Harsh Jha said.
"Closure of the Goa plant will entail a huge revenue loss for the company," he said.
The Goa plant has a capacity of 2 lakh tonne per annum.
Jha said the Goa plant depended on iron ore supplies from the Bellary-Hospet belt in Karnataka.
The Supreme Court had ordered a complete ban on mining in Karnataka citing that the forest cover would be totally destroyed because of unlawful operations by mining barons
in the region.
He said the Goa plant was contributing Rs. 500 crore (Rs. 5 billion) out of Tata Metaliks' annual revenue of around Rs. 1,300 crore (Rs. 13 billion).
The company was also in the process of acquiring 1,900 acre in Karnataka for its 3-million tonne steel plant.
Jha said the company was in the process of obtaining consent of the people for acquiring 75 per cent and the balance would be acquired by the Karnataka government.
Going by the thumb rule, investment required would be Rs. 1,500 crore (Rs. 15 billion).
The company had also shelved the expansion project at Kharagpur in West Bengal because of delay in acquisition of land by the former Left Front government.
Tata Metaliks had sought 500 acre for expansion at Kharagpur.
Asked whether it was feasible for companies to directly purchase land from the farmers which was the present state government's policy, Jha said: "theoretically it is, yes. But practically it is impossible".