Auto makers staring at production stoppage due to steel import curbs

NEW DELHI: Automobile industry body SIAM Monday said vehicle manufacturers are staring at production stoppage if there is no resolution of the issues over restrictions imposed on domestic manufacturers using imported steel.

Last month, the government had extended the deadline for automobile makers to use Bureau of Indian Standards (BIS) certified locally produced high grade steel till February.

The automobile manufacturers had sought a year's time, expressing their inability to source high grade steel locally soon citing inconsistent quality.

"Yes, our production will get hampered if it is not resolved. We are making representation to the government regarding the matter," Society of Indian Automobile Manufacturers (SIAM) President Rajan Wadhera told reporters here.

He further said nearly 90 per cent of the steel used in automobile production is manufactured in India and only around 10 per cent of high grade steel, which is used for meeting safety standards among others, is not manufactured here.

"These are imported from abroad as there is no economy of scale to manufacture these in India. We are talking to the government to resolve the issue," Wadhera added.

Moreover, he said there were issues with the quality and consistency of locally produced such high grade steel.

Auto industry sources said there was no incentives for the foreign steel makers to get BIS certification as volumes are low in India.

In June last year with an aim to promote locally manufacturing, the steel ministry had mandated BIS certification for the commodity to be sold in India. This included both for domestically produced and imported steel.

For the auto industry, December 17, 2018 was set as the deadline to meet the norm but has been extended till February 17 after automakers raised their concerns over the matter. NEW DELHI: Softening prices of fuel and some food articles pulled WPI inflation to a 8-month low of 3.80 per cent in December raising hopes for a rate cut by the RBI.

This is the second consecutive month of decline in Wholesale Price Index (WPI)based inflation. The inflation was 4.64 per cent in November, 2018 and 5.54 per cent in October.

In December 2017, WPI inflation stood at 3.58 per cent.

According to the government data released Monday, deflation in food articles stood at 0.07 per cent in December, against 3.31 per cent in November.

Vegetables continued its deflationary trend for six months and was at 17.55 per cent in December, compared to 26.98 per cent in the previous month.

Inflation in the 'fuel and power' basket in December slumped to 8.38 per cent, nearly half of 16.28 per cent in November. This was on account of lowering of prices of petrol and diesel through December. Individually, in petrol and diesel inflation was 1.57 per cent