Post News Network
New Delhi, March 27: Posco has finally decided to draw the curtains on the country’s biggest FDI project.
However, an agency report said Posco was only seeking refund from a rail line undertaking.
The South Korean multinational had a decade ago proposed the setting up of a $12 billion steel complex in Jagatsinghpur. Now, the company has moved government agencies to get back the money it gave authorities for some land and for railway connections, according to sources.
Posco has sought a refund of `27.5 crore ($ 4.4 million) that it paid in 2006 for a 10 per cent stake in the rail infrastructure firm mandated to lay the tracks.
Posco has also asked Orissa Industrial Infrastructure Development Organisation (IDCO) to return money paid for lease of a seven acre land that has remained pending.
The 82-km new rail link being set up by Haridaspur Paradip Railway Co. seeks to connect Paradip Port and Haridaspur, which is the virtual extension of the iron ore belts of Bansapani –Tomka where Posco captive mines are going to be located.
Posco, in 2005, signed MoU with the Orissa government for setting up a 12-million-tonne steel plant at Paradip. The `51,000 crore project has not made much progress because of several issues including resistance by a section of local people in the project area. The MoU had expired June 21, 2010.
Posco Engineering and Construction India Pvt. Ltd, a wholly-owned subsidiary of the South Korean giant, looks after the company’s engineering and construction aspects.
However, an agency report quoted the company spokesperson IG Lee as denying that the company is pulling out from the project. “We are still on Orissa project. Money refund is not for the steel plant land. Rail Infra refund is as per the changed company law last year,” Lee said, according to the report.
“…for railway (SPV we) cannot continue depositing any further due to changed company law,” Lee is reported to have said.
