Naveen Patnaik (left) with Montek Singh Ahluwalia in New Delhi on Wednesday. Picture by Ramakant Kushwaha

New Delhi, May 11: The memorandum of understanding (MoU) between South Korea’s Posco and the Orissa government to build the Rs 54,000-crore steel plant near Paradip will be renewed shortly, Orissa chief minister Naveen Patnaik said.

“The revision of the MoU will be done shortly,” Patnaik said, adding that land acquisition would start soon.

The state government is scrutinising the fresh application by Posco India for the renewal of the MoU for its 12-million-tonne project — the biggest foreign direct investment in the country. The earlier pact had lapsed on June 21.

The Centre had on May 2 granted final approval to Orissa for the diversion of 1,253 hectares of forest land for the facility in Jagatsinghpur.

While approving the project, environment and forest minister Jairam Ramesh had suggested that the revised MoU needed to be negotiated in a manner that the export of raw material was completely avoided. The South Korean steel major had said there was no plan to export iron ore.

The project had been hanging fire since 2005 because of the opposition from the locals and the absence of necessary approvals.

Annual state plan

The 2011-12 plan for Orissa has been pegged at Rs 15,200 crore, about Rs 4,200 crore more than last year.

The state annual plan was finalised at a meeting between Planning Commission deputy chairman Montek Singh Ahluwalia and Patnaik.

Ahluwalia has asked the state government to make progress more inclusive and reduce regional disparities. He said Orissa needed to utilise science and technology in a better way to address development-related problems and improve the condition of tribals, women and children.

The state had achieved an average growth rate of 9.57 per cent during the first three years of the 11th plan (2007-12). Agriculture and allied sectors grew 4.8 per cent during the period.