State-run Vietnam Steel Corp. (VSC) is to sign an agreement on May 29 with India's Tata Steel Ltd. for a steel complex, a VSC executive said on Friday.
The government said the total investment would be $3.5 billion.
VSC Chairman Mai Van Tinh said in an invitation sent to Reuters that the Vietnamese firm would sign a memorandum of understanding with Tata on Tuesday in Hanoi, following government approval granted on May 18.
The steel complex, to be built in the central province of Ha Tinh, 340 km (210 miles) south of Hanoi, would refine iron ore from Thach Khe mine to produce 4.5 million tonnes of steel products per year, the government has said.
It was not clear how much of investment each side would contribute to build the complex but the major steel project, along with those planned by South Korea's POSCO, could help Vietnam reduce its reliance on steel imports.
The Hanoi-based unlisted VSC has been running several ventures with foreign companies to expand domestic production.
In March VSC won an investment licence to develop a $527 million hot-rolled steel mill in the southern province of Ba Ria-Vung Tau with India's Essar group and the Vietnam General Rubber group.
Steel and billets imported to Vietnam mainly come from China. Last year Vietnam's imports of the products edged up 1.8 percent from 2005 to 5.62 million tonnes, government statistics said.
However, a robust demand of the construction sector has prompted January-to-May's imports of steel and billets to jump 39.5 percent from a year earlier to 3 million tonnes, the General Statistics Office said on Friday.
The import value would also soar 64.7 percent to $1.7 billion, the office said in its monthly report.
Source: Reuters
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