In a move that could delay the mining project of the South Korean steel behemoth Posco for its proposed $ 12-billion steel plant near Paradip port in Odisha, the central government has sought more clarifications from the Odisha government on how much of the mining land sought by the South Korean steelmaker was notified as an iron ore bearing area where commercial mining was allowed.
Mining in non-notified areas needs more approvals than in notified areas and the review of mine area allotment means further delay for Posco which has waited nine years to set up a $12-billion steel plant in India.
The previous UPA government had almost finalised the mining lease and former prime minister Manmohan Singh had said in January that Posco's request for a mining licence was at an ''advanced stage of processing''.
But, nine months on, little progress has been made on the ground and the final regulatory hurdle for the project, which would be the biggest foreign direct investment in India, remains.
Posco is yet to start work on the planned 12-million-tonnes-a-year steel project due to stiff opposition to land acquisition and delays in securing permission to mine iron ore, and reports now say, the central government too has reservations in the matter.
The mines ministry last week wrote to Odisha seeking clarity on how much of the mining land sought by Posco was notified as an iron ore bearing area in Khandadhar where commercial mining was allowed.
On Saturday, the mine ministry's website showed the status of Posco's request to explore iron ore over an area of 6,828.54 hectares as ''rejected / returned'' as of 10 October.
Posco had signed a MoU with the Odisha government in June 2005 for a $12 billion steel plant and port project- touted as the biggest foreign direct investment (FDI) in India.