Industry body ISSDA Tuesday raised concerns that exporters of stainless steel in several countries are colluding with some Indian importers to misuse the provisions of the ASEAN-India free-trade agreement.
Indian Stainless Steel Development Association (ISSDA) also said the imports of stainless steel from Indonesia have jumped over eight-fold in one year.
"Exporters of stainless steel in several countries are colluding with some Indian importers to misuse the provisions of Indian-ASEAN FTA rules," the association said.
Exporters from ASEAN countries such as Indonesia, Malaysia, Singapore, Thailand, and Vietnam are trying to avail preferential tariff under the free-trade agreement (FTA), it added.
Import of stainless steel from Indonesia into India has grown to massive proportions from nearly 8,000 tonne in 2017-18 to 67,000 tonne in 2018-19, the body said.
"Chinese investments in Indonesia are backed by Chinese government subsidies provided to expand in overseas markets. They are also subsidised generously by the Indonesian government to attract more investment," K K Pahuja, president, ISSDA, said in the statement.
Through Indonesia, the Chinese producers are indulging in rampant misuse of India-ASEAN FTA, ISSDA said adding that cold rolled material from China is exported to Indonesia for minor value additions like slitting into smaller widths, after which, the same consignment is exported to India.
"In another method to evade the duties, Indonesia imports hot rolled stainless steel coils from China and then converts the same consignment into cold rolled stainless steel coils. These cold rolled materials are then exported to India claiming preferential duty of zero per cent," he added.
The government must initiate appropriate actions against erring importers who are not only causing loss to the exchequer but also hurting the domestic industry, Pahuja said.
ISSDA has requested the government to impose anti-dumping duty/countervailing duty on imports of stainless-steel flat products from Indonesia, to counter Chinese imports, which are now being routed through the ASEAN-India FTA route, he said.
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