Senior state government officials told FE that Orissa's patience was running out and the state had decided to act tough with the country's largest private sector steel company when its iron ore mining lease comes up for renewal next year. If there was any further delay, it may even decide against renewing the mining lease, they added.
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While an MoU with the state to set up 6 mt greenfield integrated steel plant with an investment of Rs 15,400 crore was signed way back in 2004, work has still not begun.
Cancellation of mining rights in the state could create serious problems for Tata Steel's existing as well as proposed steel projects. Even at present, most of the iron ore requirement for running the company's steel plant in Jamshedpur comes from its mines in Orissa.
What has angered Orissa most is while Tata Steel is dilly dallying over the Orissa project, it is going all out to double the steel capacity at its Jamashedpur plant. Meanwhile, the company has signed an MoU with Jharkhand government for setting up another 12 mt green-field project.
Tata Steel managing director B Muthuraman met chief minister Naveen Patnaik in Bhubneshwar on May 2 to clear the misgivings. Mr Muthuraman has assured the state that work on the project would begin shortly at the Kalinga Nagar site.
State government sources, however, said the company's assurances need to be watched. The government is looking at the option of cancelling the ore lease, in the event of the company failing again in fulfilling its promise.
As it is known that Tata Steel managing director B Muthuraman met chief
minister Naveen Patnaik in Bhubneshwar on May 2 we can hope that some
solution will come out. If nothing is coming out, then our Govt should
take hard decision to renew the contract for the betterment of our
state......
Regds,
saurav