By Geena Paul
RANCHI (Commodity Online): All ‘steel’ roads lead to Jharkhand. That is the situation in India with almost all steel giants in the world lining up to set up shop in the state despite the Koda scam dogging the state.

In a recent development South Korean steel giant Posco has set its eyes on Jharkhand with a plan to ink a memorandum of understanding (MoU) with India’s state-run SAIL to jointly set up a 5 MT integrated steel project. The project is likely to cost Rs 25,000 crore. The move comes despite the long delay in the setting up of Posco’s 12 MT steel plant worth Rs 54,000 crore in Orissa.


Again, the world’s largest steelmaker, ArcelorMittal, has decided to shift the location of its planned 12-million tonnes per annum steel plant within Jharkhand to Bokaro from Khunti and Gumla districts.

With the steel ministry according an in-principle approval to the Posco proposal, it is now expected to gather steam. Senior state officials indicated that the project is likely to come up at either Bokaro or Singbhum.

However, before inking the MoU, the government will examine in detail Posco’s proposal to have a majority stake in the joint entity.

The Korean government also being a stakeholder in Finex technology, a government-to-government approval might be needed before proceeding on the MoU.

In ArcelorMittal’s case, the steel major has been facing stiff opposition from the local people in getting land in Jharkhand’s Khunti and Gumla districts for the steel plant.

This had prompted the company to postpone the commencement of plant to 2014 from 2012 earlier. ArcelorMittal’s shifting of plant just within the state offers some relief to the state government.

The company in 2005 said it is setting up a 12 million tonne greenfield project in Jharkhand at a cost of about Rs50,000-crore; but it has been facing delays in land acquisition amid regulatory hurdles.

The impasse had forced the company to scout for other areas and it fortunately found some at Bokaro. Negotiations are still on, but apparently some 1,000 acres have been sourced from about 200 villagers who have consented to sell their land.

The company also plans to start purchasing the land soon after it gets clearance from the water resources department. In the meantime, according to a company official, the process of negotiations with the villagers will continue.

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