(HT)
The government on Monday levied a 12% provisional safeguard duty on five steel products such as hot rolled coils, sheets and plates, and the said the move is aimed at saving domestic manufacturers from cheaper imports.
A finance ministry notification on Monday said the levy is provisional and temporary.
“The safeguard duty imposed under this notification shall be effective for a period of two hundred days (unless revoked, superseded or amended earlier) from the date of publication of this notification in the official gazette,” it said.
The items covered by the notification include import of non-alloy and alloy steel flat products such as hot rolled coils, sheets and plates, hot rolled plate mill plates, cold rolled coils and sheets, metallic coated steel coils and sheets, whether or not profiled, including galvanneal, coated with zinc or aluminium-zinc or zinc-aluminium-magnesium, and colour coated coils and sheets, the notification said.
The government justified the move on the ground that there was “a recent, sudden, sharp, and significant” increase in imports of subject goods into India, “causing and threaten to cause” serious injury to the domestic producers of subject goods. Indian steel majors include ArcelorMittal Nippon Steel India, JSW Steel, Bhushan Power & Steel, Jindal Steel and Power, and Steel Authority of India Ltd.
Union minister for steel and heavy industries HD Kumaraswamy “welcomed” the decision to impose the safeguard duty. “This measure is a timely and necessary step to protect domestic steel manufacturers from the adverse impact of import surges and to ensure fair competition in the market,” a ministry of steel statement said, quoting him.
“The 12% safeguard duties on steel imports, coupled with arbitrary quality control orders (QCOs), threaten to devastate India’s MSME-dominated downstream sectors,” India SME Forum president Vinod Kumar said adding that the move will make products of MSMEs uncompetitive. A QCO was imposed earlier.
He said the MSME sector will voice against the move as the “imposition of safeguard duties on steel imports lacks appropriate legal and economic justification based on procedural violations, unreliable data, absence of serious injury evidence, and potential harm to downstream industries and public interest”.
“Given these factors, it is recommended that the safeguard duty be terminated as soon as a possible or its scope revised to align with legal requirements and economic realities,” he said.
With domestic producers unable to meet demand for specialised steels like abrasion-resistant plates, imports remain critical – but safeguard duties would inflate input costs by 8-10%, mirroring recent price hikes by local mills, he said.
