The international leading steel maker, ArcelorMittal, signed an agreement with Steel Authority of India Ltd (SAIL) to set up an automotive steel manufacturing facility in India, under a joint venture (JV). This would be the first greenfield investment by the LN Mittal group in India’s steel sector.
ArcelorMittal, which scrapped plans to build a 12 million metric ton a year project in India’s Odisha state, plans to achieve a wider footprint in India through this venture, while Steel Authority plans to boost profits by adding high-margin auto-grade steel products. Local manufacturing of such products will reduce India’s dependence on imports from companies including ArcelorMittal and South Korea’s Posco.
Steel Secretary Rakesh Singh said: “Increasing the availability of indigenously produced automotive steel would reduce India’s reliance on imports and provide the Indian steel industry and the automotive industry with a sustainable competitive advantage.” He added that India is expected to grow as a hub for automobile export manufacturing facilities to cater to the international market.
The JV proposal comes at a time when South Korean steel giant POSCO is also in talks with SAIL to set up an integrated steel plant.