JSW Steel plans $7 bn plant for green steel exports to Europe

JSW Steel Ltd will invest $6-7 billion (about Rs50,000-60,000 crore) in Maharashtra over four years to set up 10 million tons (mt) per annum of green steel capacity aimed for the European market, group chairman Sajjan Jindal said on Tuesday, 15 April.

Jindal said the funding will be a brownfield investment at its plant in Salav of Raigad district, which was recently handed over to JSW Green Steel.

“We will scale production from 0-to-4 mt and then to 10 mt in the next 3-4 years. It will be mostly brownfield expansion,” Jindal said on the sidelines of an event organized by the Indian Chamber of Commerce.

In March, the company had announced plans to step up the green steel capacity at Salav to 4 mtpa in phases.

JSW Steel’s expansion plan comes as India prepares to align with the EU’s Carbon Border Adjustment Mechanism (CBAM), which levies carbon tariffs on high-emission imports.

EU’s CBAM tax will be fully implemented from 1 January next year.

Jindal said the 10 mtpa capacity will emit a fifth of the carbon as used by conventional plants currently.

The steel baron also flagged plans by China and Vietnam to dump steel into India, and nudged a “vigilant” government to slap safeguard duties to protect domestic steel makers.

Jindal also said the sector needed investments of $20 billion annually and that sufficient profits would be needed to invest in capacity creation.

The government is careful to ensure that there is no profiteering by steel firms, he said, explaining the reasons for putting in place the safeguards.

China is at its peak from a steel consumption perspective and scaling back output, he said, while pointing out that Beijing is looking at world markets to sell the excess steel.

China exported 120 mt steel last year alone, he said, adding that the commodity comes via Vietnam to India.

JSW Steel is aiming to be the largest steel producer in the world with a capacity of 100 mtpa from the present 34.2 mtpa, though Jindal did not give a timeline for the goal.

Meanwhile, as the trade war between the US and China intensifies, India is on alert to prevent any surge in diverted goods entering the country, Mint reported, citing senior government officials.

A panel, headed by commerce secretary Sunil Barthwal and comprising officials from the ministry of commerce, Director General of Foreign Trade, Central Board of Indirect Taxes and Customs, and Department for Promotion of Industry and Internal Trade, has been set up for the purpose, the report said.

The committee will closely monitor any influx of agricultural products from the US and merchandise from China. These goods could be routed through third countries such as Vietnam, Indonesia and Nepal, it added.