The move would create about 100 new jobs in Gary.
The three-year project will focus on how to add larger amounts of silicon, which helps conserve energy, to the small steel components of electric motors.
It's the latest twist in the Pittsburgh-based Northwest Indiana steel giant's months-long bid to ban Chinese steel imports from the U.S. market.
The first installment of the new Global Steel Trade Monitor ranks China first in the world for steel exports, and the U.S. first for imports.
Nippon Steel's new Shelbyville factory will employ 70 people to make wiring for cars, joining an already large Japanese automotive sector in the state.
ArcelorMittal is introducing a new high-strength steel for cars as part of an effort to boost profits.
As economic growth slows in larger global markets, Indiana businesses need to look for new ways to expand.
Steel is in high demand, benefiting Indiana, which is one of the main producers of the product.