Arcelor, Posco exits: Praful Patel calls for 'introspection'

Taking a position which is unlikely to be music to Prime Minister Manmohan Singh’s ears, UPA ally and NCP minister Praful Patel on Thursday asked the government to introspect why India has not been an attractive destination for overseas players, given the pullout by two major foreign investors within a span of as many days.

The comments by Heavy Industries and Public Enterprises Minister came after world’s largest steel producer ArcelorMittal Thursday folded up Rs 50,000 crore steel plant from Odisha, one of the biggest foreign direct investments in India on the back of South Korean Posco withdrawing its Rs 30,000 crore investment from Karnataka.

“The world community comes to invest in our country. They will not do so until they are assured that our laws, our systems, our rules and regulations are as transparent and as easy for them to be as they would do it in their own country… We have to introspect,” he said. Delays in land acquisition and allocation of captive iron ore blocks for the project were cited as the main reason for its withdrawal.

Patel’s remarks may prompt the government to start a fresh debate on its FDI policy which of late has put a premium on lifting or raising the cap and has relegated the moot question of regulatory hurdles on the backburner. "Why we should not be able to be one of the finest steel producers and at the most I would say the cost effective steel producers in the world. We don't seem to have an answer for that," he said.