Even after receiving the clearance from the environment ministry, the challenges before the South Korean steel giant to set up a plant in India are far from over

Posco India Pvt Ltd, the unit of South Korean steel giant, is likely to face fresh agitations from activists who say that they are not in a mood to surrender an inch of land to for the project in Orissa.

"Though union environment minister Jairam Ramesh has given clearance for the Posco project, we will not surrender an inch of land for the project at any cost and will resist the land acquisition process," Abhaya Sahu, convenor, Posco Pratirodh Sangram Samiti (PPSS) told Moneylife, in Mumbai today.

Last week, Posco received a conditional clearance from the environment ministry to set up a 12 million tonne per annum plant along with a captive power plant and a port near Paradip. The project would be the largest foreign direct investment in India after 1991.

The state government has said that it will start acquiring land for the project within the next couple of weeks.

"We don't want to disturb a well-established agrarian economy of the region. We don't oppose industrialisation. But it should not happen at the cost of the agriculture economy," Mr Sahu said. "PPSS has closed down check gates. Posco officials, police and the administration will not be allowed to come inside the proposed acquisition area."

Last week, the environment minister gave the green signal for the project, listing 60 conditions-28 for the steel plant and 32 for the port. "These 60 conditions are just an eyewash. The government has been writing false statements and submitting to the Ministry of Environment and Forests (MoEF)," Mr Sahu alleged.

The Posco project requires about 4,000 acres, of which nearly 3,000 acres is forest land, the state owns 567 acres and 438 acres is private land. In May 2010, the state government started land acquisition after the project received conditional and forest clearance in 2007 and 2009. However, Mr Ramesh issued a stop-work order in August last year, after receiving complaints of violation of forest norms.

Questioning the decision of the MoEF, Mr Sahu said, "Government-appointed committees-the Saxena Committee and the Meena Gupta Committee-have reported that the clearances given to Posco were illegal. However, suddenly we find that Mr Ramesh has given the clearance for the project, which is quite surprising, given the negative remarks in the committee reports."

Although Posco has received the environment clearance, there will be other hurdles in its path like acquiring mines, rehabilitation of locals and allocation of raw material linkages. Posco has said on its website that the government of Orissa has assured a mining lease for 600 million tonne reserves, which would be adequate for the 12mtpa plant in Paradip for about 30 years. Nevertheless, Posco will be conscious that there is a lot of difference between signing the papers for such projects and their execution.