JSW Group is setting up a green steel plant dedicated to manufacturing steel to be exported to the European Union (EU). The move is to adhere to the EU’s Carbon Border Adjustment Mechanism (CBAM) mandate.
The plant will be located at Salav in Raigad, Maharashtra, and operate under JSW Steel’s wholly-owned subsidiary, JSW Green Steel.
“The brownfield steel plant will have a capacity of 10 MTPA eventually, and we will invest Rs 50,000-60,000 crore over the next three-four years,” JSW Group chairman Sajjan Jindal said. He was speaking on the sidelines of an Indian Chamber of Commerce event here.
JSW Green Steel was incorporated in February last year to set up a 4 million tonne per annum (MTPA) integrated green steel plant as part of the steel major’s plan to reduce its carbon footprint.
EU’s CBAM rules have been operational since 2023, though the full financial implications will come into effect from January 1, 2026. Under CBAM, the EU will impose carbon-related tariffs on imports of carbon-intensive goods, including steel, cement and fertilisers.
Indian steel companies, which mainly use coal-based blast furnaces, have higher carbon intensity of around 2.5-2.6 tonne CO₂ emissions per tonne of steel produced in comparison to the global average of 1.85 tonne CO2 per tonne of steel. On account of this, industry estimates state that the total tax burden on the Indian steel sector is projected to increase by 20-35%.
The steel produced at JSW’s dedicated green steel plant will have one-fifth the carbon intensity of Indian steel currently, Jindal said.
He reiterated that the Indian steel sector needs to be protected from the menace of foreign steel dumping, especially from China. “The government is very vigilant about this and the recommendation for putting a safeguard duty has been made. In a few days, I think, this safeguard duty will be in place,” Jindal said.
He also said that for the Indian steel industry, which is still growing, steelmakers need to make enough money to be able to invest back into the business and expand. By contrast, China’s steel industry is mature and mostly state-owned and no longer needs a surplus. “They (China) can sell at any cost whereas we have to make profits to then redeploy that money to expand our capacity. India requires close to 20 million tonne new steel every year which requires close to $20-billion investment. India needs that kind of investment (for steel) year-on-year,” he said.