On December 22, 2020, a Memorandum of Cooperation was signed between the Ministry of Steel, Government of India & Ministry of Economy, Trade & Industry, Government of Japan in the Field of Steel Industry. The agreement will help in boosting India’s steel manufacturing sector, and also in improving the quality & quantity of steel produced in India.
i.The two sides agreed to establish “India-Japan steel dialogue” at the joint secretary-level for boosting mutual cooperation in the sector.
ii.The agreement was signed by Pradip Kumar Tripathi, Secretary in the Ministry of Steel & Shigehiro Tanaka, Vice-Minister for International Affairs, Japan.
Key Points:
i.Under the agreement the 2 sides will also discuss trade and investment related issues & promote sustainable growth in the steel sector.
ii.It will help in greater coordination between the 2 countries in the Global Market and in creation of an alternative & reliable supply chain in the Global market.
iii.The cooperation assumes significance as India & Japan were the 2nd & 3rd Largest steel producing countries in 2019 with output of 111.2 Million tons & 99.3 Million tons.
iv.The Global Steel Manufacturing is dominated by China which has an output of 996.3 Million tons.
v.However, China is accused of dumping steel and its steel exports face 15 anti-dumping investigations in 2020 in countries like Australia, Thailand, United Kingdom & United States.
India’s Steel Industry:
i.India’s demand for steel is increasing rapidly, its consumption of 88.68 million tons in 2017 is 1.7 times higher than the consumption in 2007.
ii.India’s per capita consumption of steel was 75.3 kg in 2017, which is one-seventh of figures for Japan (549.9 kg), China (544.5 kg) indicating large margin for growth.
iii.India has set a target to expand steel production capacity to 300 million tons by 2030-31.
India-Japan Cooperation in Steel sector:
i.India’s imports High grade steel from Japan.
ii.In 2019, Nippon Steel (Japan) and ArcelorMittal purchased Essar Steel India, which was one of the largest investments made by a Japan company in India.
iii.Nippon Steel & Tata Steel partnered to produce high grade steel for automobiles.
iv.Mitsubishi Corporation & Larsen & Toubro are working with the Steel Authority of India Limited (SAIL) to modernise the Rourkela Steel plant in Odisha.
Recent Related News:
i.On September 10, 2020, India and Japan signed an Agreement concerning Reciprocal Provision of Supplies and Services or Acquisition and Cross-Servicing Agreement (ACSA) between the Armed Forces of India and the Self-Defense Forces of Japan.
ii.On September 1, 2020 India, Japan and Australia agreed to launch a trilateral Supply Chain Resilience Initiative (SCRI) in the Indo-Pacific region.
About Ministry of Steel:
Union Minister – Dharmendra Pradhan
Minister of State – Faggan Singh Kulaste
About Japan:
Prime Minister – Yoshihide Suga
Currency – Japanese Yen
Capital – Tokyo
