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Beijing, May 3 (ANI): Tata Steel Limited, the world’s 10th-largest steel company in terms of production and a subsidiary of the Tata Steel Group, plans to increase its investment in China by five percent in 2012.

The company plans to maintain market share according to its managing director, Hemant Madhusudan Nerurkar.

Nerurkar said the company would not make major investments in its rolling mills, at Wuxi in Jiangsu province and Xiaman in Fujian province, this year.

“But next year, there will be some changes,” he said.

Currently, the company’s problem in China is overcapacity, which means production far exceeds demand, the China Daily quoted Nerurkar, as saying.

Nerurkar added that capacity would gradually decline as the government encourages more energy efficiency in the industry.

“Infrastructure investment in China is still very high, and there is still great demand for steel. As the Chinese industry becomes more and more self -sufficient in raw materials, I’m sure it will turn out well,” Nerurkar said.

He said the Chinese steel industry has developed very well over the last ten years at an “admirable” speed.

He also expects the company’s business in China to grow at the same rate as the country’s steel consumption growth, by five to seven percent increase year-on-year.

Apart from local demand, Tata Steel also expects to export more products from its Chinese mills to Europe and Japan, as both markets that require external supplies.

The company is not considering entering into partnerships with Chinese steel players, nor has it ruled developing downstream partnerships at some point in the future, said Nerurkar

“Possible cooperation with Chinese companies also involves issues such as energy conservation, climate change, and some energy-saving products,” he added. (ANI)