China was the top foreign buyer of Indian steel between April and September 2020, government data showed, marking a rare rise in bilateral economic activity at a time of political tensions which have triggered some trade curbs. As per a Reuters report, China bought 1.9 million tonnes of finished steel from India, cornering 29 per cent of India’s finished steel exports.
With the Indian economy contracting because of the coronavirus pandemic, domestic demand for steel has been weak, and producers have been offloading their surpluses to Chinese buyers. China, the world’s top steel consumer, has bucked the Covid-linked trend of sluggish global demand, supported by economic stimulus such as infrastructure investments.
India and China are locked in the most serious military stand-off in decades, after 20 Indian soldiers were killed in June in clashes at their disputed Himalayan border. New Delhi has introduced curbs aimed at Chinese investments, but these measures do not seems to have impacted Indian exports of steel to China.
During April-September, India’s overseas shipments of steel were primarily hot-rolled coils, a flat steel product used to make pipes, automobile parts, engineering and military equipment. China and Vietnam together purchased just over 75 per cent of Indian hot-rolled coils, of the overall 4.49 million tonnes exported, data showed.
Indian steel consumption fell to its lowest in at least six years during April-September at 35.86 million tonnes, while finished steel production also fell, by 25 per cent, to 38.6 million tonnes.