In a major development in the country’s steel sector, NRI billionaire lakshmi Mittal-led ArcelorMittal on Friday inked a pact with State-owned Steel Authority of India ltd (SAIl) to set up an automotive steel plant with an estimated investment of Rs5,000 crore, taking a fresh shot at entering India after nearly a decade-long wait for its earlier projects to take off. The details of the investment and plant size were not disclosed.
However, a source said the plant size discussed is Rs1.5 million tonne (MT) and the investment could be in the range of $850 million.’ “The proposed JV will construct a state-of-the-art cold rolling mill and other downstream finishing facilities in India that will offer technologically advanced steel products to India’s rapidly growing automotive sector,” ArcelorMittal and SAIl said in a joint statement.
“We can’t put a definitive timetable on this project. However, as a broad guide. It could take up to two years to carry out all necessary due diligence and cement our relationship into a formal joint venture company,” a SAIl spokesperson said. The project needs formalising the JV structure, assessing the various options regarding potential plant locations, costing the project and so on.
The MoU towards setting up the JV was signed by lakshmi Mittal, Chairman and CEO of ArcelorMittal, and SAIl’s Chairman CS Verma. The move is being viewed as a big step for ArecelorMittal which has been trying to make inroads into India after failed attempts to set up plants at Odisha and Jharkhand. Its work on $6.5 billion Karantaka plant is yet to take off.