JSW Steel, South Korea's Posco sign pact for steel plant in India

JSW Steel and South Korea’s Posco have signed a pact to explore setting up a 6 million tonnes per annum (MTPA) integrated steel plant in India, with Odisha among the top locations being considered for

the project. 

Both the steel makers signed non-binding heads of agreement (HoA) in Mumbai, according to a joint statement issued by the companies on Monday. 

Lee Ju-tae, representative director and president, Posco Holdings, and Jayant Acharya, joint managing director and chief executive officer, JSW Steel were present during the signing of the agreement. The HoA outlines the broad framework for the proposed 50:50 joint venture — which was announced in October 2024. 

 

As the next step in the proposed venture, JSW and Posco will carry out a detailed feasibility study to determine the plant’s location, investment structure, resource requirements and other critical factors. 

Odisha is among the key locations being considered for the project given its natural resource base and logistical advantages.

“JSW and Posco are looking at various sites which will make sense in terms of proximity to mines, logistics, port etc. Odisha remains one of our potential sites,” Acharya said. 

This partnership brings together JSW’s proven execution capabilities and strong domestic footprint with Posco’s technological leadership in steelmaking, he said. 

“The proposed venture aligns with India’s vision of Atmanirbhar Bharat and will help create a globally competitive manufacturing hub to serve both domestic and export markets,” Acharya added. 

Lee Ju-tae said in a statement that India was central to the future of global steel demand. “Our collaboration with JSW is based on mutual trust and a shared long-term vision. This initiative represents our commitment to supporting India’s industrial growth while creating long-term value for both organisations.” 

For Posco, setting up upstream capacity in India has been a journey riddled with challenges. Its last attempt to establish a steel plant in India was with the Adani Group in 2022. Previous efforts included plans for a $12 billion greenfield facility in Odisha, MoUs with the Miglani family-controlled Shree Uttam Steel and Power, state-run Steel Authority of India and Rashtriya Ispat Nigam. 

Currently, the global steel major operates a downstream unit in Maharashtra. 

On investment in greenfield, the thumb rule is in the range of $1 billion for a million tonne capacity, Acharya told Business Standard. 

“Once the technology gets decided and the contours of the project are defined, the cost of the project will be firmed up,” he added. 

For Sajjan Jindal-promoted JSW Steel, the venture adds to a long line of capacity expansion projects. 

India’s largest steel producer, with 34.2 MTPA of domestic capacity, is targeting 41.9 MTPA in India by September 2027, driven by rising demand from infrastructure spending. By financial year 2031 (FY31), the target is to take capacity to 50 MTPA in India and including the US, 51.5 MTPA. 

The agreement

 

Steel majors to undertake feasibility study to finalise location, investment terms, resource availability

 

Final terms subject to feasibility and approvals

 

Odisha being considered as a potential site