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BHUBANESWAR: Enthused over the Centre's nod to Posco's mega steel plant, the Orissa government on Monday said it would soon resume land acquisition work at the project site, but preferred a wait-and-watch approach on issues like mining and MoU renewal delaying fruition of India s biggest foreign direct investment.

"We welcome the decision and thank Union environment and forests minister Jairam Ramesh for granting approval, although the process got delayed," steel and mines minister Raghunath Mohanty said. "Posco project is important not only for Orissa but for the country as it will provide employment and spur economic activities. We will begin the land acquisition process as soon as possible," he added.

The state government was forced to halt land acquisition for the 12 billion USD project in August following a central government s stop-work order on grounds of violation of Forest Rights Act (FRA), 2006.

Ramesh announced environment clearance for the South Korean company's proposed steel and captive port projects near Paradeep in Jagatsinghpur district, but sought Orissa government's assurance that those claiming dependence on or cultivating land in the project area cannot be categorized as "other traditional forest dwellers" under FRA before it can give final nod for diversion of 1253 hectares of forest land for Posco project.

Posco's bid to access the Khandadhar iron ore reserves in Sunergarh district, around 600 km from the proposed 12 million tonne per annum-capacity steel facility site, is also pending before the Supreme Court.

Possibly keeping these in mind, CM Naveen Patnaik reacted to the development with caution. "It is good news," said Naveen, hours after Ramesh declared his decision in Delhi. "We will take appropriate action," Naveen replied to queries from journalists on when the state government would renew its memorandum of understanding with the company. The state government on June 22, 2005, signed with Posco a MoU valid for five years.

Senior government officers said Ramesh gave the green signal as he did not have "much option", but sounded caution about the Posco project becoming a reality. "A positive step has been taken. But there are a few other issues, most importantly mining, which need to resolved before the project can materialize," a senior government officer said.

Paradeep MLA and minister Damodar Rout attributed the controversy over forest law violations to "wrongful recording of forest land" and said people who cultivated betel vines on government land will be adequately compensated. The administration has identified 1877 people growing betel vines for their livelihood on 304 acres of government land. It had paid compensation to 96 of the farmers and retrieved around 11 acres of land.

Posco welcomed Ramesh's decision and said it appreciated the concerns of stakeholders on sustainability of environment and livelihood of affected people. "We are committed to take sustainable green initiatives and effective measures for conserving the land and marine environment of the area. We are also committed to create sustainable livelihood opportunities for the project affected people by implementing the R&R (rehabilitation and resettlement) package sincerely," it said, adding, "We will continue to work for welfare of the local community and plough back part of our earnings for CSR (corporate social responsibility) after operations commence."


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