Protection for steel industry may continue
The government is likely to extend protection to the steel industry by either re-notifying the minimum import price (MIP) or through wider anti-dumping duty.
An announcement is likely to be made by Thursday, a day ahead of the expiry of the MIP levied on 173 steel products announced in February.
“Options like anti-dumping and safeguard duties are being discussed. We will take a decision in the next two or three days,” a steel ministry official told Business Standard.
The government had imposed MIP to curb cheap imports from China that were crippling local industry, which feels the measure was inadequate.
“With the MIP in place, imports should have declined by 50 per cent, but have fallen only 26-28 per cent, mainly because of circumvention of duty,” Seshagiri Rao, group chief financial officer and managing director, JSW Steel, said at an earnings conference last week.
The government is also considering an anti-dumping duty once investigation on the damage to domestic industry is finished. Anti-dumping duties are in place on stainless steel and seamless tubes and pipes.
“We have submitted the report for anti-dumping but a decision on specific products could be taken in a few months,” said Sanak Mishra, secretarygeneral of Indian Steel Association.
A person close to the development said there could be a reshuffling of products in the upcoming MIP announcement to bring more into the net.
South Korea and Japan have said the MIP is not compliant with World Trade Organisation (WTO) rules. “The WTO can only tell the government not to extend MIP. It is easy for the government to fight it out. With China dumping steel in almost every part of the world, it has become easier to impose or extend trade measures,” said a Mumbai-based steel trader.
Since the imposition of MIP, domestic sales have improved though realisations are weak because of subdued demand. Production for sale of total finished steel during the quarter ended June was 24.47 million tonnes (mt), up 3.8 per cent from a year ago. Imports in the quarter dropped 30 per cent to 1.79 mt from a year ago.