Mittal to sign MoU for steel plant

As many as 106 projects with total production of 54 million tonnes of steel are in the pipeline. The total investment expected in the sector is Rs 3.01 lakh crore. The government has decided not to encourage further industries in this sector. So far, the government has approved steel industries of total capacity 90 million tonnes, whereas iron ore available in Karnataka can only match production of 45 million tonnes. 

“POSCO of South Korea wanted a mining lease in advance to set up the plant. The government has a policy not to issue the lease in advance. It is left to POSCO to decide”, V P Baligar, principal secretary for Industries and Commerce, said. The government will make 40 to 45 per cent of iron ore available for the industries. The industries have to purchase the rest from mining lease holders at international market rates.

The investors can also import iron ore. One of the investors in the sector had a mining lease in Indonesia. The company could import raw material from Indonesia. However, the investors were free to export their steel products. Karnataka has second largest reserves of iron ore (3,445 million tonnes). As many as 153 lease-holders extract the ore in 16,000 hectare. About 56 MT of ore is extracted every year. Of that, 25 MT is exported and the rest 31 MT is utilised for value addition.

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