To improve India’s image as an investment-friendly country, the government has given its go-ahead to the country’s largest foreign direct investment project — Korean steel major POSCO’s 12 million-tonne steel plant — thereby removing one of the major hurdles for the Rs 52,000-crore project.
POSCO’s project comprised of two aspects — a steel plant and a port project, ministry officials said. Petroleum minister Veerappa Moily, who has recently got additional charge of the environment ministry as well, delinked the two and granted approval for the steel plant but added a caveat that the company will have to spend 5% of the total investment on “enterprise social commitments.” The move raises the project cost by $600 million (Rs 3,720 crore).
“Though an additional burden has been put on us, we are happy with the revalidation” said IG Lee, general manager, corporate affairs, POSCO-India. “It means the removal of a hurdle for us.”
The project had received initial clearance from the environment ministry in 2007 and final approval was granted in 2011. However, a year later the approval was suspended by a quasi-judicial body, citing environmental concerns. The environment ministry’s recent revalidation of the lapsed environmental clearance comes days before South Korean President Park Geun-hye’s four-day visit to India beginning January 15.
The proposed plant has been stuck for more than eight years due to delays in getting various clearances. The clearance will pave the way for POSCO to build the steel plant but it may not take off in a jiffy as the company is yet to get ownership of land and mines.