BHUBANESWAR: The State Government has decided not to encourage fresh steel plant proposals requiring iron ore lease linkage until earlier proposals were disposed of.

"The State Government has already signed memoranda of understanding (MoU) with 42 companies for establishment of steel plants with iron ore lease linkage, it has become imperative to first honour the previous MoU before any further fresh MoU with iron ore linkage is considered," the steel and mines department told Industrial Investment Promotion Corporation of Orissa Limited (IPICOL). The steel and mines department also asked IPICOL to appoint technical agencies such MECON or Engineering India Limited (EIL) to verify claims of 14 companies which had reported to have attained eligibility of getting the State Government's recommendation for mineral concession application.

"The IPICOL has been recommending the cases of the companies which have reported attainment of milestones or parameters as per the MoU for recommendation of mineral applications. It is observed that the fact of 25 per cent investment or financial closure as per the definition of RBI or placement or orders do not seem to have been verified in the field," the department letter said.

It asked the IPICOL to take immediate action on engagement of MECON or EIL for the purpose and complete verification by April 10.

The State Government signed MoU with 45 companies and of thm, 20 steel plants have become partially operational. However, 14 companies through IPICOL informed about their financial closure and achievement of 25 per cent investment in the project to become eligible for recommendation of their Mineral Concession application to Centre.

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