To curb Chinese imports, SteelMin seeks hike in customs duty to 10%

A top coal ministry official cited that the steel companies imported 21 MT till October in this fiscal against 37 MT in FY14 and 35 MT in FY13.

Written by Priyadarshi Siddhanta

New Delhi | January 22, 2015 02:01 AM IST

3 min read

To curb the rising inflow of cheaper Chinese steel into India, finance minister Arun Jaitley is likely to raise the customs duty on its imports to 10 per cent in the General Budget 2014-15. He is also likely to withdraw the 2.5 per cent import duty on coking coal and iron ore to reduce input costs.

Steel minister Narendra Singh Tomar had cautioned that competitiveness of the industry would be compromised if no action is taken to curb such imports. Tomar has made out a strong case for increasing the customs duty citing substantial increase in imports of hot rolled (HR) coils mainly from China. Furnishing figures provided by the steel ministry’s joint plant committee (JPC), Tomar said till October FY15, imports of HR coils and sheets have grown by 58 per cent to 1.9 million tonne (MT), while imports of cold rolled coils and sheets grew by 29.5 per cent to 1.6 MT during the same period.

“We recommend raising the import duty on HR and CR coils and sheets to 10 per cent from the existing 7.5 per cent to provide immediate relief to the steel industry,” Tomar had recommended to Jaitley in the first week of January.

The Indian Steel Association (ISA) had written to the government on November 4 that imports of hot rolled coils, sheets and plates are up by 41 per cent in H1FY15, of which imports from China amounts to 111 per cent.

Abolishing the import duty on coking coal has become crucial to the survival of steel utilities as they are compelled to import the input owing to its poor availability at home. In the 2014-15 Budget, 2.5 per cent import duty on coking coal was imposed, which will have to be removed in this budget, the steel minister contended.

A top coal ministry official cited that the steel companies imported 21 MT till October in this fiscal against 37 MT in FY14 and 35 MT in FY13. With many iron ore mines witnessing temporary shutdowns in Karnataka and Goa, the mineral’s availability has depleted compelling several steel producers to source it from abroad.

The minister further wrote that till September this fiscal, 2.9 MT of ore have already been imported against 0.36 MT last fiscal and 3 MT in FY13.

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Arun Jaitley general Budget Narendra Singh Tomar