2024-11-05 17:32:16 :
NEW DELHI (Reuters) – India’s JSW Steel and South Korea’s POSCO plan to invest 650 billion rupees ($7.73 billion) in a proposed factory in India over the next few years, sources said, as efforts to capitalize on the world’s fastest-growing steel demand Part – Major economies are growing.
Last week, JSW Steel and POSCO signed an agreement to set up an integrated steel plant with an initial capacity of 5 million tonnes per annum. The plant will be located in the eastern state of Odisha, known for its iron ore reserves.
They did not disclose financial details of the agreement, but people familiar with the matter said they would initially invest 20,000 rupees in the plant, which one source said would be built next year.
Sources added that after three years of operation, the total investment will reach $7.73 billion as the company increases its production capacity to 18 million tons. They spoke on condition of anonymity because they were not authorized to speak to the media.
Neither JSW Steel nor POSCO immediately responded to Reuters emails seeking comment.
Rapid economic growth and rising infrastructure spending have made India a hotspot for global steel demand growth, even as demand from Europe and the United States tapers off. India’s steel demand hit a seven-year high in the April-August period.
Some of the world’s largest companies have turned to India to diversify their supply chains, driving a boom in the manufacturing and construction sectors. Demand for steel in India has surged as companies set up new factories and warehouses.
To further stimulate demand for steel, the Indian government, together with private companies, plans to spend $12 billion to build new airports and expand existing ones to make air travel more convenient and affordable.
Sources said the proposed JSW Steel and POSCO plants will produce hot rolled, cold rolled and galvanized steel.
A few years ago, Posco abandoned plans to build a $12 billion steel plant – billed as India’s largest foreign direct investment at the time – due to difficulties in acquiring land for the project.
The company operates a cold-rolled galvanized steel plant in the western Indian state of Maharashtra and supplies automotive-grade steel to the country’s leading automakers.
(Reporting by Neha Arora; Additional reporting by Jatindra Dash; Editing by Mayank Bhardwaj and Jan Harvey)
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