XIndia Steels brings together China's Xinxing Group, China National Metal Products and India's Sigma Minmet Ltd., Kelachandra Group and Manasara Group for a total investment of $2.2 billion. Xindia, an acronym formed by Xinxing and India, is held 45% by the Indian partners and 55% by the Chinese companies.The companies will set up a plant that will produce iron ore pellets for India's steel industry, the firms said Feb. 28.
The plant, located in the Koppal district of southern India's Karnataka state, will have an initial capacity to produce two million tons of iron that will be expanded to six million tons. The three-phase venture will set up steel plants and iron-pipe making facilities after starting with production iron pellets.
The venture plans to take advantage of growing demand for steel in India as an economy that has expanded at an average 8.6% pace in the last four years spurs industries from automobiles to construction. "This investment is in line with our strategy to be an active contributor to the emerging Indian steel industry," Xinxing Group chairman Liu Mingzhong said. "Indian infrastructure has seen acceleration in growth in recent years, resulting from the investments that have taken place in all sectors of the Indian economy," he said.
"The buoyant and vibrating Indian economy has presented investors with adequate resources and there is very high returns for investment in the steel industry," said Xindia director Gopi Ramanathan.