South Korea’s POSCO and Indian billionaire Gautam Adani, together, aim to invest about $5 billion in the steel project in the western state of Gujarat.
With this, the conglomerate, which is India’s largest player in ports and renewable energy, is making a move in the metal sector. Before this, it steps into aluminum and copper. The pact with Adani would be one of the most potent business deals and will fulfill the long-held ambition of POSCO of having a large steel mill in the country.
Earlier POSCO also had looked to set up a steel unit in Odisha worth $12billion. But the project could not succeed due to delays in mining rights for iron ore and opposition from locals in acquiring land. This time, POSCO has plus points as Adani can arrange land easily in Mundra, Gujrat for hot steel rolled plant. There are fewer chances that the project would face any problem regarding land because Mundra already houses Adani’s port, power, and processed food facilities.
Adani is likely to hold the majority stake in the steel venture with POSCO, which will mark its new entry into the whole new sector. Apart from steel, Adani, in collaboration with POSCO, is ready to explore new opportunities, including renewable energy, hydrogen, and logistic industries. Adani is making a $20 billion push into green energy with the aim to make it’s business a net-zero carbon emitter by 2030. This would really have a positive impact on global warming.
Adani-POSCO steel venture could leverage India’s conglomerate’s logistics and renewable energy infrastructures.
Now, it is to see how Adani will take this challenge because it would put the Adani group in competition with Tata Steel and other steel companies like JSW and ArcelorMittal Nippon Steel in India. Tata is already doing well in its sector as it overtook Hyundai and recorded the second-highest sales in December.