Odisha unlikely to transfer Posco project approvals to JSW

Firm intends to set up 10 mn tonne steel mill in land vacated by Posco

The Odisha government is unlikely to accede to the request of JSW Ltd, which intends to set up a 10 million tonne steel mill in the land vacated by Posco, to transfer the statutory approvals obtained for the South Korean steel firm’s project to its name due to legal barriers.

While putting forth the Rs 50,000-crore investment proposal for the project, the Sajjan Jindal-owned company has laid out a list of facilitating measure to be undertaken by the state government for its smooth implementation. 

Among other things in the wish list, is transfer of statutory clearances obtained for the Posco project to the name of JSW.

“It is highly unlikely”, said an industry department official. “The forest and environment clearances for the Posco plant were granted based on its project parameters, module and technology, which will undergo a complete change in case of JSW. With statutory clearances being project specific, fresh approvals will be required,” he added.

Posco project was based on its patented ‘Finex’ technology while JSW intends to produce steel through blast furnace route.

Given the recalcitrant stand of the local anti-industry lobby, whose protracted agitation had stalled the Posco project, it will be a herculean task to conduct a fresh public hearing to get the villagers’ nod for the environment clearance, sources said. In fact, the anti-Posco brigade is already gearing up to oppose JSW project, according to anti-Posco leader Abhay Sahu.

Apart from transfer of statutory clearances, the state government is also in a quandary to meet the need of raw material security for JSW. The steel major has urged the government to step up the iron production by Odisha Mining Corporation (OMC), with whom it intends to enter into a long term supply agreement for 30 years, to produce 100 million tonne per annum. With the annual iron ore output of the state-owned firm now standing at only 6 million tonnes, it will take years to bring it up to the desired level, sources said.

Besides that, JSW wants encumbrance-free land with boundary walls to be handed over to it. Following the withdrawal of Posco, some betel vine cultivators, who had dismantled their vines to give way for South Korean firm’s project, have re-erected their vines on the acquired land. It will once again be a tough exercise to vacate the encroachers.

Similarly, the construction of boundary wall around 2,700 acres patch acquired for Posco was halted in 2013 when the local villagers opposed the work demanding fulfilment of their charter of demands relating to compensation and job opportunity. They are still stubborn on their demands and may create hurdles in transfer of the land to JSW.