Cut in duty to abet stainless steel imports

The massive investment in infrastructure projects is expected to boost steel demand even while the cut in import duty on certain steel products is expected to open up doors for imports.

Temporary revocation of Anti-Dumping and Countervailing Duty is expected to open floodgates for imports of stainless steel flat products from China and Indonesia and could hurt domestic manufacturing.

KK Pahuja, President, Indian Stainless Steel Development Association said the temporary suspension of the CVD on stainless steel flat product imports is a big, if unintentional, gift to Chinese companies. It will hit the domestic stainless-steel industry, which has been under stress for over a decade.

“This will not only hamper Indian production but will turn many MSME manufacturers into traders. The Government’s geopolitical stand on banning Chinese apps on one hand and easing bulk trade on the other runs contrary to the goals of Atmanirbhar Bharat and $5 trillion economy-dream, he added.

“Stainless steel constitutes only 3 per cent of the steel requirement in the country, but accounts for over 35 per cent MSME suppliers who will be hit adversely by this decision, said Pahuja.

‘Steel not hit’

TV Narendran, Managing Director, Tata Steel said the reduction of customs duty on steel products will have no significant impact on the steel industry as most of the steel imported into India today comes from countries with whom we have a Free Trade Agreement and hence they enjoy zero import duty.

“The implementation of these reforms announced in the Budget will be critical for the benefits to percolate across the economy,” he said.

Seshagiri Rao-Joint Managing Director & Group CFO, JSW Steel said the Budget comes with counter cyclical fiscal policy calibration and an emphasis on building modern infrastructure. “The twin challenges of rekindling economic growth and well-defined fiscal consolidation roadmap have been addressed elegantly,” he said.

“The steel sector, in particular, will benefit immensely from the surge in demand due to higher outlays on infrastructure and public capital spending,” Rao added.