India-Japan signed a memorandum of cooperation to collaborate to improve the quality and quantity of steel produced in India, according to local media. The two countries will engage in joint secretary-level dialogues on number of issues pertaining to the steel sector. The memorandum was signed by India’s Pradip Kumar Tripathi, Secretary of Steel Ministry and Japan’s Tanaka Shigehiro, Vice-Minister for International Affairs.
The pact signed on Dec 22 will further “India-Japan Dialogue” aimed at securing sustainable growth for the steel industry through investments in high grade steelmaking and promoting new avenues of steel consumption in India. India-Japan partnership is in line with India’s strategy to reinforce trade ties with Japan and Australia to mitigate the influence of China in the region in the post COVID-19 world. The two countries will collaborate to strength supply chains and increase manufacturing capacities in India.
Major Japanese automakers have joint ventures (JV) in India and are reliant on high-grade steel imports from Japan. Also Japanese steelmakers like Nippon Steel have tie-ups with Indian steel manufacturers. Nippon Steel has partnered with Tata Steel to produce auto steel and has acquired Essar Steel in a JV with Arcelor Mittal group.
India aims to produce 300mn steel by 2030 and grow its per capita consumption of steel to 150kg from the present 75kg. In November, India’s crude steel production rose by 3.5pc to 9.2mn mt from the prior year, while Japanese production fell by 5.9pc to 7.3mn mt and China’s production rose by 8pc to 87.7mn mt. In 2019, India ranked second in global steel production with 111.2mn mt, significantly behind China’s humongous 996.3mn mt output and ahead of Japan’s 99.3mn mt at third place.