NEW DELHI: In order to protect the domestic steel production and reduce cheap dumping from China, Japan and South Korea, the government is likely to increase import duty to 15 per cent on different grades of steel.
According to Steel Ministry officials, Finance Minister Arun Jaitley will be discussing the matter with Steel and Heavy Industries Minister this week. The Finance Ministry could revise the import duty for flat and long steel products to 15 per cent, the official added.
On June 16, the government raised import duty on flat steel products (hot-rolled and cold-rolled coils) to 10 per cent from 7.5%. In case of long products, used by housing and constructions firms, the duty has been raised from 5% to 7.5 %.
The steel sector, already under stress due to stagnant demand and rising debt, is facing stiff competition from cheap steel coming in from abroad with imports rising 72% in 2014-15 to 9.3 mt.
R K Goyal, Managing Director Kalyani Steel says, “The Finance Ministry should consider the plea of steel industry, to safeguard against inferior quality steel coming from these countries. The government should increase import duty to the level of 15 per cent as Finance Minister mentioned in his Budget.”
The Finance Ministry has a leeway to further hike import duty on steel, as it had raised the limit to which it can increase the levy to 15 per cent from 10 per cent in the Union Budget 2015-16. According to Steel Ministry official, we can see hike on the industrial steel for flat products.
The earlier overall hike by the government was 2.5 per cent, which is not considered enough by the industry. N C Mathur, President Indian Stainless Steel Development Association (ISSDA) said the duty on has been imposed on hot rolled (HR) flat products of stainless steel grade with all its variants originating from China at $309 per tonne, $316 per tonne from Malaysia and from Korea at $180 per tonne.