Pranab takes up Tata Steel project with Vietnam PM

Vietnam today assured India of early clearance for Tata Steel's $5 billion project in Ha Tinh province, pending since 2008.

The assurance was given by Vietnamese Prime Minister Nguyen Tan Dung when India's Finance Minister Pranab Mukherjee called on him here.

"The Prime Minister of Vietnam said that he has already asked the concerned officials to resolve the matter at the earliest," an Indian official said.

Mukherjee asked Dung to ensure that a level-playing field is provided to Tata Steel for its 4.5 million tonne project and that there is "no discrimination against Indian investment".

Mukherjee is here in connection with the annual meeting of the Asian Development Bank.

The project is facing delay in obtaining the investment licence for which Tata Steel had applied in 2008 and again in the next year. The project requires about 4,000 acre of land and re-settlement cost is one of the major issues.

Mukherjee hoped that the issue of re-settlement costs for the land would be resolved and the investment certificate for the project would be "issued soon".

The project is to be set up by a joint venture, in which Tata Steel holds 65% stake. Vietnam Steel Corporation holds 30% stake and the balance by Vietnam Cement Industries Corporation.

An initial pact for the project was signed among the three companies in 2007 and a final agreement was reached in August 2008.

Indian Ambassador Ranjit Rae said the Tata's $5 billion project is one of the largest investments by any Indian company abroad.

During the meeting, Mukherjee also hoped the Vietnam Government would facilitate the request of two Indian public sector banks, Bank of India and Indian Overseas Bank, to open branch offices in that country to strengthen the bilateral economic cooperation.

The strategic partnership established between the two countries is based on implicit mutual trust, a convergence of interests including in the field of defence and security and similar approaches on global and regional issues.

Mentioning that defence cooperation between the two countries is robust and growing , Mukherjee said India would continue to assist Vietnam in the modernisation of its armed forces, particularly the Navy and Air Force.

India is also prepared to strengthen intelligence cooperation with Vietnam, he added.

With the ASEAN-India free trade agreement, the trade between the two countries would further increase from the current $one billion, Mukherjee said hoping the pact would be soon widened to include trade in services and investments.