The steel ministry has recommended continuation of minimum import price (MIP) for 21 flat-rolled products of non-alloy steel such as corrugated products while suggesting no action on 30 semi-finished products.
The government imposed provisional anti-dumping duty on 15 wire rod of alloy or non-alloy products last week.
Following the imposition of MIP on 173 steel products in the range of $341-752 per tonne for six months in February, aimed at containing imports, the government extended MIP on 66 items in August for two months. The term is set to expire on October 4.
Steel ministry sources said no recommendations have been made for 30 semi-finished products such as slabs and billets, mostly used by secondary producers, as imports of these items have been “negligible” so far. Currently, MIP on these items is in the range of $341-364 per tonne.
The domestic industry has already sought protection in the form of anti-dumping duty on the 21 products of coated sheets where MIP is in place now.
Indian Steel Association (ISA), an industry lobby, however, recently urged the government to extend MIP on 66 products by another six months from its scheduled expiry on October 4. The situation would be adverse if these are now imported at dismally low prices leading to an unwarranted glut in the domestic market, it said.
Steel imports to India increased to 12.7 MT, at an average of over 1 MT a month, in 2015-16 from 10.2 MT in 2014-15 and 5.7 MT in 2013-14. China, Japan and Korea accounted for three-fourths of total steel imports last fiscal.
Once the dumping duties are imposed, the MIPs become redundant. India has been under pressure in multilateral fora to remove the MIPs seen as an outdated measure that is WTO-incompatible. Shortly after MIP was imposed, steel imports started falling and the domestic industry’s sales and margins picked up. But after correcting positively till May, steel prices became very volatile.
Replacing MIP, the directorate general of anti-dumping in August recommended provisional duties in the range of $69-152 per tonne on hot-rolled coil and “HR not in coil” from specified producers in China, Japan, Korea, Brazil, Russia and Indonesia, after concluding these items are being imported into India at below normal (cost) price. In the same month, it had also slapped anti-dumping duty on certain cold-rolled flat steel products from four nations, including China and South Korea, to guard the domestic industry from cheap imports.
The government has also taken a series of other measures to bail out the domestic steel industry which was reeling under severe stress for the last two years due to imports at predatory prices, subdued demand and poor prices. It raised the rate of basic customs on both flat and non-flat steel to 15% from 10% in the Budget for 2016-17 and hiked import duty in August 2015 on flat steel from 10% to 12.5%, long steel from 7.5% to 10% and semi-finished steel from 7.5% to 10%.
The government had also imposed in June 2015 an anti-dumping duty for five years on imports of certain varieties of stainless steel from China ($309 per tonne), Korea ($180 per tonne) and Malaysia ($316 per tonne). Further, safeguard duty of 20% was imposed in March 2016 on hot-rolled flat products of non-alloy and other alloy steel, on coils of width of 600 mm or more.