South Korea-based steel giant Posco on Tuesday confirmed that it has ditched plans to build a $5.3 billion (£3.5bn) steel plant in India’s southwest state of Karnataka.

Posco announced in a statement that it decided to ditch the project due to delays in securing required mining rights, land and infrastructure and opposition by local people.

Confirming the decision, the company said, “We have agreed to drop the project given a delay in (acquiring mining rights) and opposition by local people."

On Monday, the Wall Street Journal (WSJ) cited anonymous sources saying that the South Korean steel maker had pulled out of its initial agreement with the Karnataka government to build the plant.

Posco had signed a memorandum of understanding with the Karnataka government (MoU) in June 2010 to build a steel plant in the state, with an annual steel production capacity of 6 million tones.

The South Korean steel producer also said that its another steel plant project in Odisha was progressing well, and that the latest decision about the Karnataka project would allow it to focus more on the Odisha project.

Source: Top news