To shield the domestic industry from low-cost imports, the commerce ministry’s Directorate General of Trade Remedies (DGTR) has suggested imposing a 12% temporary safeguard levy on a few steel items. The Ministry of Finance will make a final decision.
The DGTR stated in a notification that there are crucial situations in which any postponement of the application for temporary safeguard measures would result in harm that would be challenging to fix. “While awaiting a final decision on imports of the product under consideration, the authority recommends imposition of a provisional safeguard duty at the rate of 12% ad valorem for 200 days,” the notification stated.
On Wednesday, steel stocks increased as experts predicted that the companies’ earnings would improve. They think that after rising to Rs 1,500 to Rs 2,000 in the short term, the duty’s imposition may lead to price increases in the upcoming months.
JSW Steel and Tata Steel’s share prices increased by almost 3%, placing them in the top 10 gainers of the benchmark Nifty50 index.
Following an investigation that found a sudden, fast, and notable rise in steel product imports into India in recent years, the DGTR made its proposal. Hot-rolled (HR) coils, sheets, and plates, HR plates, mill plates, cold-rolled coils and sheets, and metallic-coated steel coils and sheets are among the products specifically selected for the probe.
Concerns about rising steel imports from countries like China have been voiced by domestic steel producers. MSME exporters in the engineering sector, however, have stated that any action to increase steel import taxes will render domestic goods uncompetitive and affect the nation’s outbound shipments from the industry.
Primary producers will benefit from the taxes, but the user industries will see price increases. Industry associations have demanded export parity rates for these units in order to preserve their export competitiveness, as smaller businesses may be particularly negatively impacted by the price increases.
