Japanese steelmakers appear to have taken an interesting approach to gain a foothold in India’s steel manufacturing sector. The likes of
Japan’s sixth-largest steel company JFE Steel and Sumitomo Metal Industries are negotiating with JSW Group and Bhushan Steel, respectively, for picking up equity stake of anywhere between 26% and 40% in new plants in India.
This move is distinctly different from ArcelorMittal’s strategy or that of Posco which had tried to set up projects on their own, but have made little headway, so far.
Interestingly, both the Japanese companies have chosen greenfield projects that are being set up by existing home grown steel companies. JSW Group, which had set up a steel plant at Vijaynagar in Karnataka in 1995, is now expanding capacity to 10 million tonne (mt) by March 2011. When completed, it will be one of the largest single site plants in the country, apart from the Tata Steel plant at Jamshepdur. Similarly, Bhushan Steel currently has a capacity to produce one million tonne a year and is set to start operations at a new plant in Orissa in January 2010. It will produce 2.5 million tonne of steel in a year
SOURCE:http://economictimes.indiatimes.com/
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