Bangalore, July 14 (IANS) The Karnataka government is looking for an alternative site in the state for setting up a steel plant of the South Korean major Posco after having suspended land acquisition in Gadag district as a section of farmers refused to part with their land.

"There is no re-thinking on acquiring land in Gadag district. We have put a full stop to it (land acquisition process) in deference to the wishes of farmers and swamijis (religious pontiffs) opposing it. The company (Posco) has asked us to provide an alternative site," Chief Minister B.S. Yeddyurappa told reporters on the margins of an industry event here late Thursday.

Asserting that Posco would be provided the required land (about 4,000 acres) to set up its six million tonnes per annum steel plant at an upfront cost of Rs.30,000 crore ($6.7 billion), Yeddyurappa said he had directed authorities to identify an alternative site in other districts for the greenfield project.

"I have directed the KIADB (state-run Karnataka Industrial Area Development Board) to search for a suitable land in other districts as the company has agreed to an alternative site. We will decide on the new site within a week," Yeddyurappa said after flagging off the road show for the second edition of the "Global Investors' Meet (GIM)" in June 2012 here.

Though finally only 113 farmers out of the total 536 farmers at Halligudi village, about 30 km from Gadag town, objected to the KIADB preliminary notification for acquiring 3,382 acres of their lands for the project, the government late Wednesday succumbed to the pressure exerted by the Lingayat pontiffs, a community to which Yeddyurappa belongs.

By deciding to shift Posco's steel plant out of Gadag, Yeddyurappa not only defused the imminent shutdown Thursday in the district, but also stalled the proposed state-wide agitation from July 18 by the opposition Congress and the Janata Dal-Secular (JD-S). Defiant farmers and religious leaders led by Sri Siddhalinga Swami of Thontada Math (religious institution), whose 21 acres of land was also to be acquired for the project, were also backing the stir.

Besides Gadag, Posco identified Bagalkot and Bijapur districts in northern Karnataka as potential sites.

Farmers in Bagalkot and Bijapur are also likely not to give up their land as religious leaders like Sri Siddhalinga Swami are urging farmers to oppose the acquisition.

The religious leaders are demanding that the government acquire only barren land unfit for agriculture to set up industries.