Govt looking at PPP model for land acquisitions

Protests over land acquisition have kept its Orissa plans from taking shape and ArcelorMittal, the world's largest steel maker, is looking to take its money elsewhere. This has the government in damage control mode, reports CNBC-TV18's Mehak Kasbekar and Aakansha Sethi.

Protests against ArcelorMittal have delayed the steel-giant's plans to set up a 12 million tonne steel plant in Orissa.  These protests have pushed the world's largest steel company to look outside Orissa to implement its Rs 40,000 crore project.

VK Bhatnagar, CEO, ArcelorMittal, says, "We may look at alternative sites outside Orissa"

Karnataka may be the steel-maker's next stop. Sai Prathap Annayyagari, Minister of State for Steel, says, "Karnataka is willing to offer a corridor."

Problems over land acquisition have caused the bulk of the delay. Forget ArcelorMittal, even giants like Tata Steel and POSCO have faced problems. And this has the government worried.

Sources in the steel ministry say the government is now thinking of making the land acquisition process easier through a Public-Private Partnership model, like the one used to build Delhi International Airport, where companies will be encouraged to set up multiple plants in a single area rich in natural resources.

So, a company bidding for a fertilizer unit would be free to develop land as it wishes, and would be encouraged to set up a steel or chemical plant near the fertiliser unit.

Case in point: Sindri in Jharkhand. The 6,000 acres of land at this site includes coal mines, a key raw material for steel production. This opens the door to a steel plant in the area. Sources say bids for Sindri will be invited in December.