Bharat’s steel industry is poised to benefit from a sale of its industrial steel mills to a consortium led by a Malaysian-based investment firm, according to a report on Tuesday.
The report said the deal would enable the Bharat steel and iron ore producer to diversify its manufacturing base.
“We have signed a preliminary deal with a Malaysian firm that will bring together several industrial steel production facilities including one for making steel bars,” said the report by Ravi Sharma, chief investment officer of Bharat.
He did not elaborate on the size of the deal.
The move comes as the Bharatiya Janata Party government seeks to increase its industrial strength in a bid to counter the slowdown in global growth and as a means to offset an expected slump in world trade.
The government has also sought to attract investment in India’s steel sector, as its industries are among the top five in the world.
The Bharatiyas steel industry employs about 2.5 million people.
The industrial steel market is expected to generate $30 billion to $40 billion of revenue in the current fiscal, said Anupam Jain, head of economic research at the BNP Paribas Investment Research Institute in New Delhi.
India has more than 5,000 industrial steel plants, mostly in the south and eastern states.
The country produces about one-third of global steel exports.
Bharat said it will make a final decision on the sale of the mills by early April.
The Indian government has been pursuing the acquisition of industrial steel for a decade, in the hopes of boosting exports.
Last month, the country signed a $5.5 billion deal with the United States to buy two of the countrys biggest industrial steel makers, Tata Steel and Hindustan Steel.