The much-awaited joint venture (JV) between steel giant ArcelorMittal and state-run SAIL will be operational by December this year, Steel Minister Chaudhary Birendra Singh said today.
"An MoU was signed earlier, but there were some issues related to production, etc, which will be sorted in a month or so. It should be operational by the year-end," Singh told reporters here.
The Minister said the JV plant by the world's largest steel maker and India's biggest steel producer will also focus on producing specialised grade steel products for defence, space and automobiles.
In May this year, an inter ministerial group (IMG) had reviewed the progress of MoU that aims to set up an estimated Rs 5,000-crore joint venture (JV) plant to produce auto grate steel in the country.
Singh's predecessor Narendra Singh Tomar had earlier told PTI: "We have signed an MoU with ArcelorMottal for a steel plant. We want to finalise the project this year. Work on it is progressing."
The proposed JV will construct a cold rolling mill and other downstream finishing facilities in India, touted as one of the fastest-growing automotive markets in the world with production expected to double between 2014 and 2020, from 3.6 million units to 7.3 million units.
In an investor presentation in June 2015, ArcelorMittal had said the proposed steel plant will come up at a major auto cluster in India.
India has four major auto clusters - Pune-Chakan belt in Maharashtra, in the outskirts of Chennai in Tamil Nadu, Sanad in Gujarat and the Gurgaon-Neemrana belt spread across Haryana and Rajasthan.
The world's largest steel maker expects India to grow as a hub for automobile export manufacturing facilities to cater to the international market and establishing an automotive focused production presence in the country is a natural progression in executing its global automotive strategy.
The move is considered a big one for ArcelorMittal, which is trying to enter India after failing for a decade to set up plants in Odisha and Jharkhand. Its work on the USD 6.5 billion Karnataka plant is yet to take off.
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