Posco closer to iron ore access on SC decision

PascoPosco India CMD Yong Won Yoon with Orissa CM Naveen Patnaik

Apex court recognises primacy of executive in framing policy

South Korean steel major Posco's planned $12-billion steel project in Orissa cleared a major hurdle on Friday with the Supreme Court order paving the way for it to get a mining licence in the state. The apex court set aside an earlier Orissa High Court order that had quashed the state government's recommendation to allot an iron ore mining licence for 600 million tonnes to the company in the Khandadhar hills in Sundergarh district.

A bench comprising of justice RM Lodha and justice SJ Mukhopadhyay asked the Centre to consider all the objections raised by various parties and take a decision. The objections were raised by another mining firm, Geomin Minerals and Marketing, which held that its application for mining licences was submitted before Posco's and hence the state government was wrong in recommending Posco's case prior to its. While the state government had challenged the high court's order as it had quashed its right to provide the mining licence, Geomin had challenged it on the grounds that the order had gone beyond its prayer and not addressed its grievance.

The onus now is the central government to determine which companies get the licences and in what order. There are several other firms apart from Posco and Geomin that have applied for mining licences.

Since the central government has been keen to see that the project progress as it is billed as one of the largest foreign direct investments in the country, the development is seen as positive for Posco. However, for the project to move ahead full steam, it needs a final environmental clearance from the environment ministry, and the land acquisition process needs to be completed without any major protest from the local population.

The positive sentiment that followed the SC's order was echoed in the company's response to the development. "We believe that this will significantly help to expedite the project," YW Yoon, chairman and MD, Posco India, said in a statement. "We are happy that it has come at a time when there has been significant progress on the land clearance work for the project."

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