Bhubaneswar, April 9: Orissa government will ask Jindal Stainless Steel to shell out more money for the additional land that it requires for its proposed 1,102-acre SEZ in Kalinga Nagar for a metallurgical engineering and downstream sector of upcoming steel units in the area.

The SEZ at Kalinga Nagar was proposed to be set up by the state-owned Industrial Infrastructure Development Corporation of Orissa (Idco) over 250 acres of land for metallurgy-based engineering and downstream industries.

However, early last month, the state government asked Idco not to pursue its SEZ venture as Jindal Stainless also proposed to set up a metallurgical-based engineering and downstream SEZ in the same area.

The earmarked 250-acre will now be provided to Jindal Stainless for setting up the SEZ. The Jindal SEZ was cleared by an empowered group of ministers meeting last week.

Jindal Stainless is setting up a 1.6-million tonne per annum greenfield integrated stainless steel project in Orissa, which would involve mining of iron, manganese and chrome ore for production of ferroalloys and stainless steel in the melt shop and rolling mills. It will also set up a 500-MW captive power plant.

But the 250 acres of additional land in addition to its 1,102 acres would cost Jindal Stainless dear. Idco has now proposed to collect “additional development costs” over the current market price of Rs 3.35 lakh per acre.

Ashok Meena, managing director of Idco, said the state agency has already spent Rs 18.46 crore in developmental works in Kalinga Nagar and needs more money to meet the cost of rehabilitating the displaced families.

“We have forwarded the proposal and it is under consideration of the committee,” he added.

“We have made clear that costs made during acquisition must be recovered prior to handing over the land,” Meena further said.

The Idco land, proposed to be handed over to Jindal’s SEZ area, however, does not run contiguous and there is a 50-metre corridor in between, which could be used for roads and pipelines.