Posco continues to be wary of steel projects in India

Posco officials visited Andhra Pradesh to look into the possibility of creating an integrated steel mill, but this was more of a consequence. “The government wanted Posco to consider investing in a joint venture with RINL (Rashtriya ispat nigam) and we just went to check. We have not decided on the specifics. Construction of a new steel plant in India is not an easy task, ”G.Kh. Bang, Managing Director of Posco Maharashtra.

In fact, preliminary negotiations with the state-owned RINL began last year, when a delegation led by the South Korean ambassador was at the plant, but Posco has yet to clarify its plans. His past experience of setting up an integrated steel mill in India is likely along the way.

In 2005, Posco signed a Memorandum of Understanding (MoU) to establish a 12 million ton steel plant to install a 12 million ton steel plant near Paradip with an investment of Rs 52,000, considered India's largest foreign direct investment (FDI). But the project never came to fruition, mainly due to the fight against land acquisition and also due to uncertainty about iron ores. It's not that Posco doesn't have a presence in India. The blast recalled that Posco invested Rs 8,000 crores in a two million tonne. It has a subdivision downstream in Maharashtra.

Bang said ArcelorMittal and Nippon are acquiring Essar instead of starting a new project.

Ironically, ArcelorMittal also tried to build a factory from scratch around the same time as Posco, first at Odisha, then at Jharkhand and finally at Karnataka. However, none of the new projects have come to fruition, although Arcelor is believed to be making efforts to revive the Karnataka project.

Both Posco and ArcelorMittal signed Memoranda of Understanding on steel mills at a time when agreements to establish megastaller plants became regular. Projects announced at that time exceeded a turnover of 100 million tons, but hardly any materialized with land problems and non-working mines turned out to be the biggest stumbling blocks.

Jayantha Roy, senior vice president of ICRA, said the obstacles to establishing new factories in India were one of the main reasons for the tug-of-war by metallurgical companies, which were ordered by the Reserve Bank of India (RBI) to resolve debt under the Code of insolvency and bankruptcy (IBC).

“These were ready-made capacities with all the necessary clearances. A strong strategic player will be able to deploy the plant, ”he explained.

ArcelorMittal has been fighting an epic battle for two years to complete the acquisition of Essar. But then it took him much longer to create new factories in India.

In 2005