Though six months have passed since its MoU with Orissa government for setting up a 12 greenfield steel mill lapsed, Posco is yet to reply certain queries made by the state government for its renewal, official sources said today.

“Certain queries have been made to Posco-India. But it is yet to respond. Once it is received, there should be no problem in renewing the MoU,” Chief Secretary, B K Patnaik told reporters here.

The MoU issue was raised in the wake of the Centre according conditional clearance to the Posco project on January 31.

The tenure of the five-year MoU with the South Korean steel major lapsed on June 21, 2010, official souces said adding that the proposed project to set up a mega steel plant near Paradip failed to make much headway.

“We will renew the MoU with Posco at appropriate time,” Steel and Mines Minister, Raghunath Mohanty said.

Sources said Posco-India was reluctatnt to accept any new clause in the renewed MoU suggested by the state government.

The state government which has decided to reserve jobs for local people in all mega projects, wanted it to be incorporated in the fresh MoU with Posco-India, sources said.

According to new job reservation policy, all industries setting up units in the state would provide at least 90 per cent jobs in unskilled category to local people including the families affected by project and upto 60 per cent jobs in semi-skilled category.

Similarly, 30 per cent of the jobs need to go to local people of the state in supervisor and managerial cadre.

However, senior executive posts could be filled from open market, the new policy said.

While other mega projects including Tata Steel and Jindal have already accepted the state’s job reservation policy not yet notified till today, Posco-India was reluctant to accept it claiming that job reservation on geographical basis did not conform to the constitutional provisions of India.

“However, we hope Posco-India will soon cooperate for renewing the MoU,” the minister said.

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