South Korea's POSCO hopes to begin work on a new US$12 billion steel plant in eastern India in April after a year's delay caused by a "politically biased society," a report said yesterday.
The proposed unit in India's southeast coastal state of Orissa represents the largest foreign direct investment since the country launched market reforms in 1991 and aims to create 18,000 jobs in the next decade.
But POSCO's plans have been beset by problems since the initial pact was signed in June 2005, including opposition by communist parties who support Indian Prime Minister Manmohan Singh's government and farmers who say the plant will unfairly take over their land.
"The politically biased society here is posing lots of hurdles in setting up the steel plant and this has resulted in the delay of the project by more than a year," Cho Soung-sik, chairman and managing director of POSCO India, told the Indian Express newspaper.
"We however do not intend to withdraw unless asked to leave," he was quoted as saying.
In October, senior communist leader A.B. Bardhan warned Singh against any forced land acquisition for POSCO, sparking speculation that the firm may move elsewhere.
Tensions have been high among thousands of residents facing eviction from the 1,600 hectares of coastal district earmarked for the plant.
Last year, protesters briefly kidnapped several POSCO employees in two separate incidents.
POSCO India's senior general manager Vikash Sharan told the Indian Express that the company had worked out a compensation package for displaced farmers "that is likely to help the company start work from April 1, 2008."
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