Steel Authority of India Limited (SAIL) and Indonesia's Krakatau Steel plan to invest up to US$350 million (US$350 mn) in a stainless steel slab plant in Indonesia, sources said. The proposed facility will have an annual capacity of 500,000 metric tonnes (t) and is expected to be operational within three to four years. The investment and capacity figures were disclosed by two Indian sources familiar with the matter and follow a preliminary agreement reached earlier this month. The companies intend the arrangement to secure slab supply for downstream processing in India.

The firms signed a preliminary joint venture accord during the visit of the Indian prime minister to Indonesia and plan to send a technical team next month to prepare a feasibility report. The sources indicated the equity structure, timeline for government approvals and other commercial details will be finalised after the feasibility work. Deliberations remain private and the companies have not issued public statements, according to the available information. The proposed schedule envisages construction and commissioning over a multi?year timeframe.

SAIL will use the entire slab output for its Salem rolling and finishing plant in the southern state of Tamil Nadu, the sources said, with finished products to be supplied primarily to Indian customers. A small proportion of shipments could be exported to the Middle East and Europe once production stabilises. The proposed factory's capacity could be expanded after it begins operations to meet additional demand. The arrangement is designed to integrate upstream slab production in Indonesia with downstream value addition in India.

The announcement comes as SAIL remained the third largest steel producer in India in the fiscal year to March 2025 with a 10.1 per cent share of the domestic market, data from commodities consultancy BigMint show. India's finished steel consumption has risen 55 per cent over the past five years while production increased by 42 per cent, creating incentives for capacity partnerships abroad. Steelmakers are prioritising the domestic market amid weaker exports to Europe and Britain and continued competition from Chinese producers.