Ending a six-year-long wait, the environment ministry on Monday granted approval to the Orissa government for diversion of 1,253 hectares (3,100 acres) of forest land to set up the Rs 54,000-crore Posco steel project, the country's biggest foreign direct investment venture.
But environment minister Jairam Ramesh said the nod was conditional on Posco regenerating an equal area of forest in an area decided by Orissa, as well as paying for the land.
Reacting to Ramesh's approval, chief minister Naveen Patnaik said, "Appropriate action will be taken after we receive the order."
Posco India vice-president Vikas Sharan welcomed the decision and said, "Work on the project would start as early as the land acquisition is done."
Ramesh has also asked the state government to completely avoid allowing Posco to export any raw material, especially iron ore, in the revised accord to be signed soon. Posco had signed an agreement with the Orissa government in 2005, which expired in 2010.
This MoU had provisions for the export of iron ore, something that made Ramesh "deeply uncomfortable". Sharan, however, assured that the company would not export any iron ore from the project.
The South Korean major will set up its integrated steel, power and port project in Jagatsinghpur district, around 200 km east of Bhubaneswar.
Of the total 4,004 acres required for the plant about 3,000 acres are forest land. The remaining land had already been sanctioned to the company by the state.
While giving his nod, Ramesh rejected the claims of Posco Pratirodh Sangram Samiti (PPSS) - a group opposing the project since 2005 - that tribals and other traditional forest dwellers inhabited the proposed project area.
During Ramesh's visit to Bhubaneswar on Friday and Saturday, the state government termed the pallisabha (meeting of all villagers) resolutions of two villages - Dhinkia and Gobindapur - as "fraudulent information".