The domestic steelmakers, hit by a tepid demand for the alloy, have sought a safeguard duty on hot-rolled coil, sheets and plates to avoid “injury” from cheaper imports.
Recently, the import duty was hiked by 2.5 percentage points on a wide range of steel products, but given India’s free trade pacts with major steel-exporting countries like Japan and Korea, the tax increase hasn’t really helped to curb imports.
Alleging that the HR coil is being imported at around R2,000 per tonne cheaper than their per tonne selling price of R28,000-29,000, steelmakers have urged the Director General of Safeguards to impose the duty as soon as possible so that it does not add salt to the “injury” already caused.
Sources in the government said that the safeguard duty, which is product-specific and not country-specific, might actually be imposed within the next 2-3 weeks. The rate, however, is yet to be ascertained. The proposed move, which is detrimental to the cause of the importers, would benefit all major steelmakers such as SAIL, JSW Steel, Tata Steel and Essar Steel, among others.
Considered as the benchmark steel product, HR coil is largely imported by traders and foreign firms like Posco and others, which process imported HR coil to sell them in customised forms as per the requirement of the customers in the Indian market. Of the 9.3 MTPA steel imports last fiscal, more than a quarter were that of of HR coils, sheets and plates.
Cheaper imports, industry sources said, are prohibiting them to jack up the price.
“China is always a threat and will continue to remain so. Japanese and Korean steel firms are taking advantage of the free trade agreements to sell products in India at a much cheaper price which is not justifiable. The safeguard duty can give us some support,” an industry official said.