Orissa to renew MoU with Posco India

Law dept completes its scrutiny.

The decks seem to clearing for the renewal of Memorandum of Understanding (MoU) with Posco India for its 12 million tonne per annum greenfield steel project proposed near Paradip.

With the law department completing its process of scrutiny, the state government is now upbeat on renewing the pact with the South Korean steel major soon.

"The law department has completed its scrutiny in connection with the renewal of MoU with Posco India and we are hopeful of renewing the MoU soon. The MoU with the steel firm was valid for a period of five years and it has been nearly a year since the pact expired. However, the period of renewal of MoU is yet to be decided and it is currently being examined by the steel & mines department", said Raghunath Mohanty, minister for industries and steel mines.

Posco India had entered into a MoU with the Orissa government on June 22, 2005 for a period of five years.

Earlier, Industrial Promotion and Investment Corporation of Orissa Ltd (Ipicol) had recommended the renewal of MoU with Posco India for a two years. However, the recommendation was not accepted by the steel & mines department which felt that the period is not sufficient to make an appropriate assessment on the mega steel project.

The renewal of MoU with Posco India had hit a roadblock, ostensibly due to the South Korean steel firm's reservations over the mandatory implementation of the employment clause introduced by the state government for all industries.

The state government had categorically stated that the employment clause, seeking reservations for the locals will be mandatory and applicable for all industries who have signed MoUs or are going to sign MoUs with the state government and Posco India cannot be made an exception.