The State Government has decided not to allow Korean steel major POSCO to set up a Rs. 32,336-crore steel plant at Halligudi in Gadag district.

“POSCO's steel plant is a closed chapter in Gadag district. The project is dropped and it will not be established in Gadag,” said Gadag district in-charge Minister C.C. Patil, who also holds the Women and Child Development portfolio.

Addressing presspersons here on Monday, Mr. Patil said the Gadag district's development would be adversely affected on account of dropping of the project. Opposition parties, particularly the Congress, were responsible for the Government's decision, he said. A large number of farmers had supported the project and were ready to give their lands. But the Congress leaders instigated farmers to launch protests against the mega steel project, Mr. Patil claimed.

The Karnataka Industrial Areas Development Board (KIADB) had issued a preliminary notification for acquiring 3,382 acres of farmland at Halligudi for the plant. But farmers, seers and Opposition parties opposed the acquisition. A few farmers had expressed their readiness to handover lands if they were paid higher compensation, the minister said.

Mr. Patil said the Congress leaders, who have no political base in the district, led the agitation against the project to get political mileage and gain farmers' sympathy. The Congress lost to the Bharatiya Janata Party in the Assembly, Lok Sabha and zilla panchayat elections in the district in the last few years, he said.

Asked about the relocation of the project, the Minister said he was unaware of the relocation.

Mr. Patil said the water from the Singatalur lift irrigation project would be supplied to farmers' lands in the district this year. The work on the project, which commenced about two decades ago, would be completed in a year.