POSCO is moving forward with the construction of an integrated steel mill in India, a high-growth market with a population of 1.46 billion.
POSCO announced that it signed a joint venture agreement (JVA) with JSW Steel, India's top steelmaker, on Thursday (local time) to build an integrated steel mill. The investment under the agreement totals $7.29 billion (approximately 10.76 trillion won).
The signing ceremony was attended by top executives from both companies, including POSCO Group Chairman Chang In-hwa, JSW Group Chairman Sajjan Jindal, POSCO President Lee Hee-keun, and JSW Steel President Jayant Acharya.
POSCO said the partnership aims to tap into India's high-margin market and further strengthen the global steel supply chain based on a strong alliance.
POSCO laid the groundwork for the partnership through a memorandum of understanding (MOU) signed in October 2024 when Chairman Chang and Chairman Jindal met in person, followed by a Heads of Agreement (HOA) in July last year. With the final contract now signed, the joint project enters the full-scale construction phase. The joint venture will be an equal partnership structure, with each company holding a 50% stake.
The new integrated steel mill will have a fully integrated upstream-downstream production system with a crude steel capacity of 6 million tons. Based on blast furnace technology, it will consist of ironmaking, steelmaking, hot rolling, and cold rolling/coating processes capable of producing high-value-added premium steel. The site has been secured in Odisha, adjacent to iron ore mines and offering efficient logistics, power, and infrastructure. Construction will take 48 months, with completion targeted for 2031.
The two companies are reviewing plans to supply a portion of the power from renewable energy by leveraging POSCO's low-carbon operating technology and smart factory capabilities together with JSW's renewable energy infrastructure. Through this, they plan to establish a low-carbon production system that conforms to the 'Green Steel Taxonomy' established by the Indian government as the world's first of its kind.
"Through this joint investment, we will do our best to combine POSCO's innovative steel technology with JSW Group's strong local competitiveness to create future value and make substantial contributions to the industrial development and economic growth of both countries," President Lee said.
President Acharya added, "This partnership with POSCO will serve as an opportunity to unite the vision and will of both companies. We expect it to be an important step in strengthening India's steel ecosystem and solidifying the national industrial value chain."
POSCO's long-cherished India steel mill project has finally borne fruit as the 'complete localization strategy' has yielded tangible results since Chairman Chang took office. POSCO had sought upstream entry into India four times since 2004, but failed due to difficulties in finding a joint venture partner and securing a site.
However, POSCO has since successfully carried out downstream investments including electrical steel plants and automotive steel sheet plants, and has accumulated Indian business experience by solidifying its partnership with JSW Group, which owns a leading Indian steelmaker.
India is a high-growth market where steel consumption growth has exceeded 10% in recent years, driven by gross domestic product (GDP) growth, urbanization, population increase, and manufacturing expansion. In particular, demand for high-value-added steel products is expected to grow as the market for premium steel used in automobiles and home appliances expands amid rising incomes and more sophisticated consumption patterns.
POSCO Group plans to confront the global protectionist crisis head-on through its 'complete localization strategy,' which consists of the integrated steel mill construction in India, equity investment in a Louisiana steel mill in the United States, and cooperation with Cleveland-Cliffs. Domestically, the group will focus on producing high-value-added products, transitioning to intelligent factories by integrating artificial intelligence (AI) and robotics, and developing Korean-style hydrogen reduction steelmaking to secure future growth engines.
