Sajjan Jindal-led JSW Group and South Korea’s POSCO Group on Tuesday signed an agreement to set up an integrated steel plant in India with an initial capacity of 5 million tonne per annum (MTPA).
In addition to steel, the two companies will also collaborate for green energy production and manufacture of battery materials for electric vehicles (EVs).
“This memorandum of understanding (MoU) with POSCO marks a significant step forward in our journey to contribute to the Indian steel industry. As one of the world’s fastest-growing economies, India presents tremendous opportunities for sustainable growth and our partnership with POSCO strengthens JSW’s commitment to drive that transformation,” Sajjan Jindal, chairman, JSW Group, said.
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India’s steel demand is forecast to grow 6% annually through 2035 to reach 240-260 million tonne, according to McKinsey & Co, driven by infrastructure construction, transport and consumer appliances.
“This collaboration will contribute significantly to the economic development of Korea and India and drive our joint efforts towards a more eco-friendly and sustainable future,” Chang In-hwa, chairman of POSCO said. The MoU was signed at JSW Group’s corporate headquarters in Mumbai, in the presence of Jindal, POSCO chairman and senior executives from both the business houses.
JSW Group did not give details of the investment or location of the proposed steel plant, or other details regarding the MoU.
JSW had announced an investment of Rs 18,000 crore in 2019 to ramp up the capacity at its Vijaynagar facility by 6 MTPA. Industry estimates put the investment for the project with POSCO at Rs 15000-20,000 crore accounting for inflation and depending on the location of the plant.
While the JSW Group did refer to the association as joint venture, it did not clarify the nature of the partnership in terms of the equity infused by each partner.
JSW Group did not respond to queries on the matter till the time of going to press.
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