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JSW Steel has signed a Memorandum of Understanding with JFE Steel Corporation to conduct a feasibility study and to establish a grain-oriented electrical steel sheet manufacturing and sales joint venture company in India.

“This feasibility study for a JV with JFE Steel for manufacturing grain-oriented electrical steel sheet in India will strengthen our position as India’s leading manufacturer of advanced steel products that lead to reduced CO2 emissions and a more sustainable world,” said Seshagiri Rao, Joint MD, JSW Steel, in a statement on Friday.

The plan is to complete the study within the current 2021 fiscal year and take appropriate steps to set up this JV company subject to requisite approvals. 

JSW Steel expects the electrical steel growth demand to increase in the coming years.

“The steadily increasing demand for electric power, the growing adoption of renewable energy and the electrification of automobiles, continued growth is forecasted in India and globally for grain-oriented electrical steel sheet primarily used in transformers,” the company said in a media statement.

Electrical Steel Products contain additives such as Silicon and Aluminium.

Grain-oriented electrical steel exhibits magnetic properties in a single (rolling) direction making it ideal for the iron cores of power transformers. 

JSW Steel and JFE Steel have been in alliance since they signed a comprehensive strategic collaboration agreement in 2009, under which JFE Steel took an equity stake in JSW Steel, and has provided technical cooperation with regard to automotive steel products.

In the year 2012, JSW and JFE entered into an agreement where JFE has provided technology for the production of non-oriented electrical steel sheets.

“Our partnership with JFE Steel since 2009 has provided us access to cutting-edge technologies and world-class technical expertise to enhance our operational excellence,” said Rao in a statement.