Centre not opposed to POSCO getting majority stake in SAIL's proposed venture

Discussions are on to set up 1.5 million tonnes integrated plant at Bokaro

Union Steel Minister Virbhadra Singh on Monday said the government was not opposed to South Korean steel giant POSCO getting a majority stake in its proposed Rs.12, 000-crore joint venture with Steel Authority of India Ltd. (SAIL).

“In principle, we are not opposed to giving a majority stake to POSCO in the joint venture, for which we will be seeking a Union Cabinet's approval in a couple of months,'' Mr. Singh told reporters on the sidelines of a summit here.

SAIL and POSCO are in discussions to set up a 1.5-million tonne integrated plant at Bokaro to produce high grade steel from low-grade iron ore and non-coking coal by using the world's third largest steel company's FINEX Technology. “The agreement between the companies is expected to take place in the next two-three months,'' Mr. Singh added.

According to Steel Ministry officials, the plant, to come on about 2,500 acres within the premises of SAIL's Bokaro steel unit, could cost about Rs.12,000 crore.

Similarly, referring to the new Mines Act approved by the Group of Ministers (GoM), Mr. Singh said it might seek concessions for SAIL and NMDC from the 26 per cent profit sharing rule, proposed in the draft Mining Bill, as the PSUs had been fulfilling social obligations for long.

“Some special consideration has to be given to PSUs for the historical role being undertaken in different parts of the country,'' he said when asked if PSUs would be exempted from the mandatory profit sharing regime being proposed in the new Mining Bill.

However, Mr. Singh said he was not in favour of complete exemption from the proposed rule for the PSUs. The new Bill, likely to be placed in the winter session of Parliament, seeks to expedite grant of mining rights in a transparent manner and attract big investments in the sector.