Conglomerate Adani Group has signed a $5 billion deal with South Korean steelmaker POSCO that includes setting up of an integrated steel mill in Gujarat's Mundra.
The agreement intends to further collaborate at the group business level in various industries such as renewable energy, hydrogen and logistics in response to carbon reduction requirements, the two companies said in a statement.
POSCO and Adani said they are examining various options to cooperate and leverage the technical, financial, and operational strengths of each company.
The two firms plan to utilise renewable energy resources and green hydrogen, in line with their environmental, social and corporate governance (ESG) commitments to sustainability and energy efficiency.
"POSCO and Adani are able to come to great synergy in the steel and environment-friendly business with POSCO's state-of-the-art technology in steel making and Adani's expertise in energy and infrastructure," says Jeong-woo, Choi, the CEO of POSCO. "I hope this cooperation will be a good and sustainable business cooperation model between India and South Korea."
Founded in 1988, the Adani group has the fastest-growing portfolio of diversified businesses in India with interests in logistics (seaports, airports, shipping and rail), resources, power generation and distribution, renewable energy, gas and infrastructure, among others.
"This partnership will contribute to the growth of India's manufacturing industry and the Aatmanirbhar Bharat scheme championed by the Government of India. It will also help to strengthen India's standing in green businesses," says Gautam Adani, chairman of Adani Group.
Last month, Fortune India reported that the Adani group has outperformed India's two biggest conglomerates – Tata Group and Reliance Industries – in terms of market capitalisation growth over the past year. The Adani-led conglomerate's market cap zoomed 183% from ₹3,46,435 crore on November 13, 2020, to ₹9,81,910 crore on November 5, 2021.
POSCO, on the other hand, runs a 1.8-million-tonne steel mill in Maharashtra, which supplies to the country’s automotive industry. It also has four processing units in Pune, Delhi, Chennai and Ahmedabad.
The two companies also signed a Memorandum of Understanding (MoU) with the Gujarat government for support and cooperation.
In November last year, the Adani group said it expects to be the world's largest renewable power-generating company by 2030. The firm said it is investing heavily in renewable energies, tripling its solar capacity over the next four years and improving its wind-generated power capabilities.
"I am confident that we are on the cusp of a hydrogen-driven revolution that can transform India, green India and energise India at a price point lower than what we pay today. This is nation-building at its best," Adani had said at the time.
The production of clean hydrogen, according to Adani, will strengthen India's basket of alternative energies, enabling India to become an exporter of green energy, a prospect that was impossible to even contemplate just five years back.
Vast amounts of green power can both contribute towards India achieving its net zero goals while enabling the economic aspirations of Indians, particularly in rural areas, the billionaire had said.