Environment ministry to decide Posco steel plant fate in a month

The fate of the $12-billion steel plant by South Korea's Posco, will be decided by Jairam Ramesh, the union minister of environment and forests by the third week of January.

The controversial plant, first planned by the South Korean steel giant way back in 2005 – and which was to have been the single-largest foreign direct investment in India – has been facing a lot of environment-related problems.

In November, the environment ministry recommended the temporary withdrawal of the forest clearance given to Posco's proposed steel plant in Orissa's Jagatsinghpur district. The ministry's forest advisory committee (FAC) said the projected violated the Forest Rights Act.

The steel plant is coming up on a 1,620-hectare plot, of which nearly 1,200 hectares comprise forestland.

According to Ramesh, his decision will be based on the reports of three expert panels: the FAC, the Expert Appraisal Committee (EAC) and the Coastal Regulation Zone report. The minister says the decision relating to the proposed Posco plant would be the toughest he has had to take as environment minister.

The Korean company has been annoyed with the on-again, off-again approach of the Indian government to the plant. The project had got all the necessary environmental clearances in 2008, but in November, following a committee report, the environment ministry was urged to scrap the earlier clearances.