BackPosco may exit Karnataka project, Tatas seek entry
Posco may exit Karnataka project, Tatas seek entry
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Bangalore: Even as Posco’s plan to set up a steel plant in Karnataka may be on the verge of getting scrapped, the Tatas are in advanced talks to invest Rs10,000 crore in the southern state.
Tata Sons Ltd is seeking to put money into sectors such as real estate, infrastructure and power across 9-10 projects, Murugesh Nirani, Karnataka’s small- and medium-scale industries minister, said in Bangalore on Monday.
Posco will most likely not go through with its Rs32,336 crore proposal after the steel giant was denied a mining licence in advance for the Bellary plant, the minister said.
It won’t now be part of the Rs3 trillion of investment expected to come to the state, the minister said, three days before the Advantage Karnataka-Global Investors Meet (GIM) that’s scheduled to be held this week.
Brotin Banerjee, managing director, Tata Housing Development Co. Ltd, said the realty arm of Tata Sons had significant interest in the state as part of the group’s investment plans.
Karnataka lost out in the race to host the Nano car plant, which went to Gujarat after being forced to leave West Bengal.
Of the total promised investments so far, the single largest share had belonged to Posco, followed by ArcelorMittal India Ltd’s Rs30,000 crore steel plant project, also in Bellary.
Most of the investments are in the steel and cement sectors, more than half of which is in the mineral rich areas of northern Karnataka.
The two-day GIM is taking place after a decade, with ArcelorMittal chairman Lakshmi Mittal expected to be present at the inauguration.
“Posco had too many conditions and also wanted a captive mining licence as a pre-condition before any investment, but we didn’t agree to it," said V.P. Baligar, principal secretary (industries) in the Karnataka government.
When asked about the Karnataka project, Posco-India Pvt. Ltd vice-president Vikas Sharan said, “It is being handled directly from Korea. We are not handling this; we are responsible for only the Orissa project." An email sent to Posco’s Korea office was not answered.
ArcelorMittal has already paid Rs260 crore towards land acquisition to the Karnataka Industrial and Area Development Board while Posco has not made any payment to the government even after its project was approved earlier in May, said a senior government official, who didn’t want to be named.
“We have applied for a mining licence for three mines in Bellary and are awaiting clearance," said a senior ArcelorMittal India official.
“The final clearance comes from the Central government," the official added.
madhurima.n@livemint.com
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