National Mineral Development Corporation (NMDC) will finalise its joint venture with Russia's Severstal by the end of the year. The 50:50 joint venture will set up a three million tonnes per year steel plant in Karnataka.
"By December, we will sign a joint venture agreement with Severstal of Russia to set up a 3 MT steel unit. It will be a 50:50 joint venture," NMDC chairman Rana Som said today.
State-run NMDC is also expected to sign an agreement for acquiring 26 per cent stake in a coking coal mine of Sunflag Iron & Steel in Mozambique. NMDC is currently doing due diligence for three to four mines overseas, Som said.
The Navratna public sector unit had signed a MoU with Severstal for setting up a 3 million tonne steel plant in Karnataka, involving investment of about Rs25,000 crore. The joint venture has a provision to expand capacity to 5 million tonnes in due course.
The first joint venture steel project of the two countries, the partnership would produce auto grade and electrical steel to meet rising demand for specialised steel products in the country.
The joint venture will be supported by two subsidiaries - a captive coking coal mining subsidiary in Russia (a joint venture with Sunflag) and an iron ore-mining subsidiary in India - which would ensure long-term raw material supply for the project.