Calcutta, Nov. 30: The Bengal government has decided to tread with utmost caution in the allocation of natural resources to steel investors.

Bengal has received around 13 proposals from various local and national steel players to set up plants totalling a capacity of 27 million tonnes, when fully completed. In terms of proposed investment, the figure stands at over Rs 1 lakh crore.

However, the investors have demanded high amounts of natural resources to implement their projects. A back-of-the-envelope calculation shows that they have sought 20,000 acres of land cumulatively. They will also need close to 50 million tonnes of coal annually.

Given their huge demand, the government has turned cautious — at a time when many global steel giants, such as ArcelorMittal and Tata Steel, have either cut production or deferred expansion plans.

“We want specific (production) commitments for every phase the companies are going to put up. Based on that, land, coal and water linkages will be provided to them,” Subrata Gupta, managing director of the West Bengal Industrial Development Corporation (WBIDC), said.

It is likely that if the companies fail to reach the promised target for each phase, the resources will be withdrawn.

The government feels such steps are necessary since the industry will find it hard to get cheap credit as the economic climate has deteriorated.

Such strict measures are required only if the government is able to deliver on its commitment to provide the resources.

The downturn in steel has given it some breathing space in the difficult task of obtaining coal and acquiring land.

For the coal links to the projects, the state needs approval from the UPA government, which is not favourably disposed towards the Left Front after the latter walked out of the UPA.

Sources in the state government admitted that steel companies were not showing much urgency since they had put their expansion plans on hold. Gupta, however, said there was no slackening on the part of the WBIDC. “We want to be ready whenever the industry is ready,” he said.

Steel companies publicly maintain that they are fully committed to the Bengal projects.

Aditya Jajodia, chairman of Jai Balaji, said he was totally focussed was on the Purulia plant. “The meltdown won’t deter us. It is a good time to build and be ready for the next boom,” he said.

Mahesh Agarwal, director of Adhunik Steel, said the company was a serious player. “We want to put up a 1.1 million tonne plant. For such scale of projects, finance is available,” he said.