New Delhi: Luxembourg-based ArcelorMittal SA and state-owned Steel Authority of India Ltd. (SAIL) on Tuesday discussed the contours of setting up a $1 billion joint venture factory for a high-end automotive steel plant in India, the companies said in a joint statement after their meeting.

The statement said steel minister Chaudhary Birender Singh, SAIL chairman P. K. Singh and other officials from India called on ArcelorMittal chairman and chief executive officer Lakshmi Mittal, group chief financial officer and chief executive officer of ArcelorMittal Europe Aditya Mittal and executive vice president and head of global automotive Brian Aranha at their London office to discuss the joint venture. Tuesday’s discussions followed completion of a major part of the project’s feasibility study.

The companies had last year reached an understanding for studying the feasibility of making auto-grade steel in India. The proposed factory for high-end steel products aimed at India’s rapidly growing automotive sector will get raw materials from SAIL’s hot strip mill in Rourkela, Odisha.

“India is forecast to become the world’s third largest automobile manufacturing nation by 2026, with passenger vehicles likely to grow from approximately three million units today to over seven million units in the next 10 years,” said the statement. It added that automobile producers have been establishing increased presence in India, offering a huge potential for the joint venture.