India's state-run mining giant National Mineral Development Corporation (NMDC) Ltd and Russia's largest steel maker OJSC Severstal will jointly invest $2 billion for setting up an integrated steel plant in Karnataka.
NMDC, India's largest mineral explorer and Severstal, a vertically integrated international steel and mining company based in Russia, will each have a 50 per cent stake in the joint venture and will jointly appoint the senior management team as per the memorandum of understanding (MoU) signed by the two companies.
The MoU was signed by Rana Som, CMD of NMDC and Severstal CEO Alexey A Mordashov in New Delhi today.
The joint venture will tie up its cocking coal requirements in Russia while the iron ore will come from India.
"The joint venture company proposes to have its captive coking coal mining subsidiary in Russia and an iron ore mining subsidiary in India which will ensure a long-term supply of these critical steelmaking raw materials to the proposed steel plant.
The plant, which will come up in Karnataka, will have a capacity of between 2 and 5 million tonnes per year," Severstal said.