POSCO has backed out from the Haridaspur-Paradip rail link project, and the fate of the company's eight million tonne steel plant now hangs in the balance.
POSCO decided to withdraw from the project after it apprehended that the company would get no more mines, as the Mines and Minerals Development and Regulation Act had come into force.
For this project, the South Korean steel major had provided around Rs 27.5 crore for land acquisition. In 2006, a special purpose vehicle (SPV) was formed to expedite the project, and POSCO was part of the SPV, christened Haridaspur Paradip Railway Company. Rail Vikash Nigam (RVNL) holds a major share of 48.43 per cent in the SPV.
With the withdrawal of POSCO from the project, Jindal Steel, Essel Mining and Industries, Rungta Mines, and MSPL remain the other partners in the SPV. All of them have business interests in the state.
The rail link was crucial to the POSCO project as the company planned to get the raw material using this link from the mineral-rich belt of the state. It was expected to carry about 19 million tonne of traffic annually.
More Project Info:
Haridaspur-Paradip BG Railway Line