Nippon Steel, Tata sign $480 mln India steel JV
Nippon Steel Corp, the world's No.4 steelmaker, and Tata Steel said on Friday their USD 480 mn cold-rolled sheet steel joint venture will begin production in India by late 2013.
January 07, 2011 / 19:47 IST
Nippon Steel Corp, the world's No.4 steelmaker, and Tata Steel said on Friday their USD 480 mn cold-rolled sheet steel joint venture will begin production in India by late 2013.
The 600,000-tonnes-a-year plant, which targets India's surging automotive sheet steel market, will be the first production base for a Japanese steel maker in India."India's huge growth potential is very attractive," Junji Uchida, Nippon Steel managing director, told a news conference."We also see a big advantage in linking up with Tata, which has high self-sufficiency rates in iron ore and coal, and a big cost advantage."India's growing manufacturing sector is expected to become a base for exports to the Middle East, Africa and Europe, he said. India's car market of around 2.4 mn units a year is growing 15-20% annually.Tata has a self-sufficiency rate of 100% for iron ore and 50% for coking coal, Anand Sen, vice-president of Tata Steel , said.Other leading Japanese steelmakers -- JFE Holdings Inc, Sumitomo Metal Industries Ltd and Kobe Steel Ltd -- have forged technology tie-ups with players in India. JFE owns a near-15% stake in JSW Steel.Nippon Steel and Tata agreed to continue talks aimed at expanding co-operation, including construction of the upstream process, the two companies said.While India's steel demand is growing rapidly, capacity additions lag due to difficulty in acquiring land and opposition from farmers.Tata Steel plans to boost production capacity from 7 mn tonnes a year to 10 mn in 2011 and 30 mn by 2020, Sen said.The joint venture, to be built on the site of Tata's plant in the eastern Indian town of Jamshedpur, will be 51 percent owned by Tata and 49% by Nippon Steel. The firms signed a memorandam of understanding on the project in April 2010.(USD 1=83.51 Yen) Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
