"India's huge growth potential is very attractive. We also see a big advantage in linking up with Tata, which has high self-sufficiency rates in iron ore and coal, and a big cost advantage," said Junji Uchida, managing director of Nippon Steel.

The Joint Venture will source the steel from Tata Steel's plant in Jamshedpur and is part of Tata Steel's strategy of producing value added steel. The joint venture company is expected to be incorporated within one month. The Chairman of the joint venture company will be nominated by NSC and the Managing Director will be nominated by TSL.

The joint venture will address the localisation needs of Indian automotive customers for high grade cold-rolled steel sheet and meet the needs of the growing Indian automotive industry.

India's growing manufacturing sector is expected to become a base for exports to the Middle East, Africa and Europe, said Junji Uchida. India's car market of around 2.4 million units a year is growing 15-20 percent annually.

NSC and TSL have a long history of cooperation in areas of mutual interest and this partnership is further strengthened through the formation of the joint venture. The joint venture will benefit from NSC's world class technology for production of high grade  cold-rolled steel sheet and  Tata Steel's leadership position in the Indian automotive industry to serve its customers with innovative products and services.

Tata Steel plans to boost production capacity from 7 million tonnes a year to 10 million in 2011 and 30 million by 2020.