Centre okays 20% safeguard duty on steel imports, industry cheers

Deepak Kumar | The Dollar Business

The government on Monday announced that it has imposed 20% safeguard duty for a period of 200 days on inward shipment of certain steel products to curb its surging imports. The steel products under consideration were “hot-rolled flat products of non-alloy and other alloy steel in coils of a width of 600 mm or more”. “The recommendations of the DG Safeguards were examined by the Standing Board on Safeguards, which after due deliberations confirmed the recommendations of the Director General of Safeguards for levy of provisional safeguard duty of 20% ad-valorem for 200 days on such goods,” said the Ministry of Finance in a statement. The Director General of Safeguards had earlier carried out an investigation based on the demand of the Steel Authority of India, Essar Steel Ltd. and JSW Steel Ltd. to check the recent surge in imports and its effect on the domestic industry. The authority had later recommended to the Ministry of Finance of an imposition of 20% provisional safeguard duty on some steel imports. The imposition of the safeguard duty brings an end to industry’s prolonged demand. “We welcome this measure as we had been expecting this immediate measure for long. Steel products are available in China at nearly 25% cheaper rate. The implementation of safeguard duty may not reduce import drastically, but will keep a check on its growth,” Ferro Alloys Corporation Limited (FACOR’s) Director of Finance C V Raghavan told the Dollar Business. Steel imports have increased sharply from just 5% in 2013-14 to nearly 13% in 2015-16. “The import grew in selected category that we were unable to manufacture. The other categories we manufacture in India are better than the global standards. We have invested in technology to manufacture those products as well. Soon we will be able to manufacture products based on domestic demands to match their expectations,” Raghavan said. During last fiscal, India imported 9.32 million tonnes of steel products, up 72% from 2013-14. Despite growing local demand, market share of domestic steel manufacturers have declined to 37% in 2014-15 from 45% in 2013-14. “Every country in the world is protecting their domestic steel industry. Hence the step taken by the Indian government is in the right direction,” Essar Steel’s Chief Commercial Officer H Shivramkrishnan told The Dollar Business.  

September 15, 2015 | 3:18pm IST.