Areas for cooperation include automotive steel, energy reduction and environmental programmes.
JSW Steel on Thursday entered into a collaboration agreement with JFE Steel Corporation of Japan. This collaboration provides a platform to both companies to leverage each other’s strengths to their mutual benefits. At the outset, both of them have, in principle, agreed to collaborate in India in the area of automotive steel, including production technologies and supply of substrate materials for hot rolled, cold rolled and galvanized products.
The scope also covers joint service activities including application engineering and product development for automotive customers.
The collaborators are to execute separate detailed agreements to spell out the scope and time-frames in each of the areas.
Other areas of possible collaboration between them include production of steel products other than automotive steel, energy reduction and environmental programmes, quality and yield improvement programmes, performance audit of JSW facilities, benchmarking of techno-economic parameters between the two collaborators and procurement of raw materials within and outside India The two companies are also looking at a project for building and operating an integrated steel production facility in JSW’s West Bengal steel project and mutual stockholding.
JSW Steel Vice Chairman and Managing Director Sajjan Jindal said, “this collaboration opens up new vistas for our massive expansion projects and is an important milestone in JSW’s mission of moving up the value chain in steel production.”
“JFE, with this agreement is determined to intensify its relationship with JSW to serve the request of its automotive customers, which are rapidly expanding production, in local procurement of value-added steel products,” said JFE Steel President and CEO Hajime Bada.
“This agreement shall also provide JFE an avenue to look into the future possibilities of development in India,” he said. JSW Steel is expanding the production capacity to 11 million tonnes per annum (tpa)by 2011 from the current 7.8 million tpa. The company aims to become a major player in the value added segment and its extra wide hot strip mill will be ready by March 2010. It plans to expand its capacity to 32 million tpa by 2020 by setting up greenfield projects of 10 million tpa each in Jharkhand and West Bengal.
JFE is the second largest Japanese steel company with a capacity of 33 million tpa. It has world-leading technologies in value added products and environment protection and energy-saving technologies and was aiming to secure a local production base to serve Indian customers.