World's largest steel maker ArcelorMittal and SAIL today inked a pact to jointly set up a steel plant in India for the fast growing automotive sector.
The MoU was signed here by Lakshmi Mittal, Chairman and CEO of ArcelorMittal, and the state-owned Indian company's Chairman CS Verma.
"The MoU is the first step of a process to establish a JV between the two companies," said a joint statement by both the companies.
"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," it said.
The details of the investment and plant size were not disclosed.
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. "This proposed collaboration between ArcelorMittal and SAIL is a positive and welcome step towards fulfilling the objectives of the 'Make in India' campaign launched by Hon'ble Prime Minister, Narendra Modi."
Mittal said the company was in discussions with SAIL for some time and the pact indicated its intention to further advance the collaboration.
"Bringing together our leading automotive technological capabilities with SAIL's production scale in India, in a similar manner to ArcelorMittal's partnership with Hunan Valin on our VAMA joint venture in China, is an exciting and powerful combination," Mittal said.
"The automotive sector is a highly strategic and important market for ArcelorMittal; establishing an automotive focussed production presence in India, one of the world's fastest growing automotive markets, is a natural progression in executing our global automotive strategy," he added.
Verma said SAIL is on the verge of completing a comprehensive modernisation and expansion programme to increase its hot metal capacity from 14 million tons per annum (MTPA) to 23.5 MTPA, with a quantum jump in production of value added steels.
