SAIL, Krakatau Steel plan $350 million stainless steel slab plant in Indonesia

India’s state-owned Steel Authority of India Limited (SAIL) and Indonesia’s Krakatau Steel are planning to jointly invest up to $350 million in a stainless steel slab manufacturing plant in Indonesia, according to a Reuters report citing sources familiar with the development.

The proposed facility is expected to have an annual production capacity of 500,000 tonnes and could become operational within the next three to four years. The project follows a preliminary agreement signed earlier this month between the two companies during Prime Minister Narendra Modi’s visit to Indonesia, where both sides agreed to explore the establishment of a joint venture.

As part of the next phase, SAIL is expected to send a technical team to Indonesia to prepare a detailed feasibility report. The report will help determine the project’s commercial viability, equity structure, regulatory approvals and implementation schedule before the final investment decision is taken.

One of the key strategic advantages of the proposed partnership is Indonesia’s abundant nickel reserves. The country accounts for more than half of the world’s nickel production, making it an attractive destination for stainless steel manufacturing. Access to competitively priced nickel is expected to strengthen SAIL’s raw material supply chain and improve long-term cost efficiency.

According to Reuters, the stainless steel slabs produced at the Indonesian plant will be shipped to SAIL’s Salem steel plant in Tamil Nadu for rolling and finishing. The finished stainless steel products will primarily cater to the Indian market, while a small portion is expected to be exported to customers in the Middle East and Europe.

The proposed investment also reflects India’s broader strategy to strengthen overseas partnerships in the steel sector. The government has been encouraging Indian steel producers to collaborate with resource-rich nations to secure critical raw materials while supporting future export growth.

With domestic steel consumption continuing to rise and demand for value-added stainless steel products increasing across infrastructure, construction and manufacturing sectors, the proposed SAIL-Krakatau Steel venture could become an important step in strengthening India’s stainless steel value chain and enhancing supply security over the coming years.