ArcelorMittal has finally crossed the biggest hurdle in setting up any project in India -- land. The company has got 2,569 acres of land out of the total need of 2,705 acres near Bellary, Karnataka, required for its steel plant from the state government.
ArcelorMittal spokesperson said, “We have made progress on land acquisition in Karnataka. The Karnataka Government has transferred the 2,569 acres of private land in the company's name and the process to transfer another 136 acres of government land is underway. The process of getting various clearances including crucial environment clearance is underway. We have also applied for mining leases which are critical for the project. We are focusing on getting all relevant clearances.”
Bellary is the rich iron ore district of Karnataka where most of the steel plants, including the 10 million tonne plant of JSW Steel is located. The land has been acquired by the Karnataka government through Karnataka Industrial Area Development Board (KIADB) and the company had deposited Rs 260 crore with the government for the same.
However, construction of the plant is still nowhere near as the company is waiting for a clarity on the iron ore mines allocation policy. Sources said that the construction will not begin unless the company gets a definitive word on iron ore.
In 2010, during the global investors’ meet in Karnataka, ArcelorMittal and various other steelmakers like Tata Steel, NMDC-Severstal, JSW Steel, POSCO, Essar Steel, to name a few had signed the memorandums of understanding (MoUs) with the state government to set up steel plants in the state. However, the iron ore mining ban by the Supreme Court due to the ill-effect of illegal mining in the state slowed down the progress of the MoUs.
Even now, steelmakers, including ArcelorMittal, are yet to get the iron ore leases for their plants. The company has cleared that the steel plant construction will not begin unless the iron ore mine leases are in place. This could particularly continue to delay the Rs 30,000 crore 6 million tonne steel plant by ArcelorMittal and other companies in the state as the debate is currently raging in the country on the future of natural resource allocation.
The Supreme Court has currently put a cap of 30 million tonne of iron ore mining in Karnataka which is sufficient for the 16-19 million tonne steel capacity that is presently installed in the state. Any new capacity, like ArcelorMittal, will need the 30 million tonne cap to be relaxed or iron ore be brought from other states.
ArcelorMittal’s fate in states like Jharkhand and Odisha still hang in air as the company has failed to achieve any progress. It has plans to set up 12 million tonne each steel plants in the two states.