One of India’s premier industry bodies has urged the government o slap a 25 percent import duty on all steel products to protect domestic companies against cheap Chinese imports.
The Federation of Indian Chambers of Commerce and Industries (FICCI) said the government should introduce the duties in it annual budget, which is to be presented in parliament later this month.
Falling prices and dumping by China have seen margins of Indian steelmakers drop and they have been demanding more protection, as China – the world’s biggest producer and consumer of steel battles a slowing economy.
“As an interim measure, we suggest that the customs duty on all steel products be immediately increased to 15 per cent,” the industry body said. It said tariffs on both long and flat products need to be increased to provide a level playing field to the domestic industry.
Import duty on long products is 10 percent, and on flat products 12.5 per cent. During April-August, India imported 4.5 million tonnes of steel against 2.9 million tonnes during April-August 2014 — a massive growth of 51 per cent.
Free trade agreements (FTA) with countries such as Japan and Korea have also hit the industry, and FICCI said, adding imports from these countries had also risen adding to the difficulties.
“FTAs have not benefited domestic steel producers; they rather proved to be detrimental. Thus in future any FTA or CEPA (comprehensive economic partnership agreement) including RCEP (regional comprehensive economic partnership) should exclude steel products from its ambit,” FICCI said.
China is also under pressure in Europe where steelmakers are worried, as cheap imports have led to job losses at a time when most of them are struggling against falling global prices.
Earlier this month, thousands of steel workers joined their colleagues from other industries for a protest march in Brussels to urge the European Union to not give China the market economy status that Beijing has been demanding, as that would make it difficult to slap anti-dumping charges against manufacturers from the world’ second-biggest economy.