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South Korean steel maker Posco has received environment clearance for its $12.6 billion steel plant in the eastern Indian state of Odisha, ending an eight-year wait for the project to get off the ground.
“Yeah, I have cleared it,” India’s Environment Minister M Veerappa Moily said in New Delhi. “It (the approval) was given about a week back.”
The approval comes a week ahead of South Korean President Park Geun Hye’s visit to India. The clearance will pave the way for Posco to build the steel plant with an annual production capacity of 12 million tons.
The Posco project has been stalled since 2005 due to problems related to environmental clearance and land procurement.
The mineral-rich state of Odisha has been trying to attract foreign and Indian investment by giving them mining rights, electricity and water at low prices.
The Environment Minister delinked the two and granted approval for the steel plant.
The Ministry has, however, stressed on Posco to spend on “social commitments” in India, a company spokesman said, raising the project’s cost by $600 million.
Environment clearance for the port project is still pending. A United Nations panel of experts had in October 2013 urged the South Korean steel giant to suspend plans for the steel project.
Posco’s steel project had received initial clearance from the Environment Ministry in 2007 and final approval was granted in 2011.
A year later, the approval was suspended by the National Green Tribunal in 2012, citing environmental concerns.