The cut-off rate for these items announced by the director-general of foreign trade (DGFT) in the commerce ministry in December first week is proposed to be "modified" with a view to affording relief to the user industry, according to DGFT sources. The sources said that the modification may result in lowering the floor price, adding that the Government is seized of the matter.

Intended to lift the sagging spirits of the domestic steel industry, the sources said that the floor price had turned out to be quite high and proved "uneconomic" for fabricating sheets using hot-rolled and cold-rolled coils as raw materials in the face of a rapid fall in prices overseas.

The decline in prices was set in motion after the imposition of anti-dumping duties on some steel items by thefinance ministry, the sources said.The minimum cost, insurance and freight (C.I.F.) price fixed by the DGFT is $232 for HR coils (TMQ), $243 for hot-rolled sheets, $299 for cold-rolled coils, $545 for tinplates, $577 for electrical sheets (CRNO), $311 for plates, and $560 for alloy steel bars and rods (hot-rolled in coils)--all prices on a per-tonne basis (C.I.F.).

The DGFT followed the import floor price set for seconds and defectives with a notification, fixing the cut-off price for seven grades of prime steel based on the average Japanese and European steel prices.

The effect of prescribing the minimum C.I.F. value implies that imports of these items treated as "restricted" will need a licence.

It is understood that imports of these items above the minimum C.I.F. value will be permitted without a licence. The division in the steel industry on the floor price came to the fore during a news conference organised by the Confederation of Indian Industry in Delhi on Thursday.

While the steel majorsunanimously demanded a level-playing field for the domestic industry to overcome the demand slump and international steel recession, the Cold-rolled Steel Manufacturers Association and Tinplate Manufacturers Association wanted withdrawal of the DGFT notifications.