Steel product imports rise faster; creating inverted duty structure: EEPC India

Imports for the finished goods in the form of products of steel and iron have been increasing in the range of 22.5% and 51% between June and August this year

The Engineering Export Promotion Council (EEPC) of India has opposed extension of minimum import price on steel as it said the non-tariff barrier on crucial inputs was resulting in an inversion of duty with imports of finished goods increasing at a faster pace than the raw material.

“Any inversion in duty at this stage would be a big setback to Make in India where the entire focus is on taking the country several notches up on the value and technology chain so that we become a global factory,” said EEPC India Chairman T S Bhasin.

Imports for finished goods in the form of products of steel and iron increased at up to 51 per cent between June and August this year, EEPC India said in a statement.

On the other hand, imports for the raw material by way of steel and iron used purely for raw material dropped between June and August. On August 4, Directorate General of Foreign Trade extended the minimum import price (MIP) on 66 steel products till October 4. The MIP is in the range of $341-$752 per tonne.

The government had earlier levied MIP on 173 steel products ranging from $341 to $752 per tonne on February 5, which was valid for six months. While the measure has led to curtailment of cheaper imports to some extent, it has also increased idling capacities of small steel manufacturers and downstream industry, EEPC said.