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Posco’s exit plan from Rs 52,000-cr Odisha project is almost certain

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Posco’s exit plan from Rs 52,000-cr Odisha project is almost certain

Posco’s exit plan from Rs 52,000-cr Odisha project is almost certain
November 07
12:59 2015

By Our Correspondent

BHUBANESWAR, NOV. 3: The exit of Pohang Steel Company, popularly known as Posco, from Odisha appears to be almost certain. The company, which had earlier closed down its corporate office at Fortune Towers here in the city, has communicated its intention to return to the Odisha government a piece of land it was provided for construction of its guest house.

According to state chief secretary Gokul Chandra Pati, the South Korean steel major Posco has sent a letter to the general administration (GA) department expressing its desire to return the piece of land.

“Posco has written a letter to the GA department expressing its desire to return the land allotted for its guest house in Bhubaneswar. The property shall be brought to the government register as per rules,” the chief secretary said on Tuesday.

The state government had allotted 1.7 acres of land in Bharatpur area here in the state capital for construction of its guest house in 2008. However, the land remained unused.

The GA department had earlier issued show cause notice to Posco for not developing the land.

Posco has put its 12-milliont-tonne integrated steel project proposed to be set up at Paradip in Jagatsinghpur district on hold as it sees no assured supply of raw material linkage from Khandadhar iron ore mines in Sudargarh district.

In fact, the Odisha government in its memorandum of understanding signed with Posco in 2005, had pledged to provide iron ore from Khandadhar mines. However, after the amendments to the Mines & Minerals Development Regulations Act (MMDR Act) last year, the company has now to participate in open bidding to get the mines, a proposition which Posco has rejected from the beginning.

On October 23, Odisha Chief Minister Naveen Patnaik had taken up the matter with Union finance minister Arun Jaitley and urged him to hold a high-level meeting to resolve the deadlock with regard to Posco.

However, the closing down of the Posco’s corporate office and return of the piece of land allot here before the Union government made any intervention, has further added to the apprehension of the steel behemoth withdrawing from its Rs 52,000-crore investment proposal.

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