Raise customs duty on steel products to beat Chinese imports: ASOCHAM [May 2012]

Industry body ASSOCHAM called for raising import duty on steel products to a minimum of 10 per cent so that domestic manufacturers can withstand rising inflow of distress and surplus steel from China.
The Budget for 2012-13 proposes to revise import duty on non-alloy flat steel products from 5 to 7.5 per cent. China exports large quantity of Boron-treated hot rolled coils, sheets and plates conforming to alloy steel category, and offers export incentive at the rate of 9 per cent of export value, said The Associated Chambers of Commerce and Industry of India (ASSOCHAM).This attracts only 5 per cent import duty and not 7.5 per cent as increased in the recent Budget proposal, said secretary general DS Rawat in communication to the finance ministry. From October 2011 to February 2012, steel imports have increased by 120 per cent over the same period in previous year.
China, the largest steel producer in the world with capacity to produce 828 million tonnes, has an excess capacity of 135 million tonnes. “This implies that surplus capacity of China is almost twice that of India’s annual steel production of about 70 million tonnes,” said Mr Rawat.
Also, excluding alloy steel category of flat steel from the import duty revision will be a conduit for continuing imports unabatedly and will not address the issue in its holistic manner.
China continues to remain the world’s largest steel exporter registering about 50 million tonnes or about 20 per cent of the global steel trade (excluding the intra-trade in Europe). In addition, China exports almost 70 per cent of the quantity to its neighbouring countries across east, south and central Asia and Australia.

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