Steel makers’ long-pending demand to give them a level-playing field vis-à-vis imports gets rewarded in the Budget with the Finance Minister raising import duty to 7.5 per cent from 5 per cent earlier.
“The Finance Minister’s decision to enhance basic customs duty on non-alloy, flat-rolled steel to 7.5 per cent from five per cent and duty reduction on imported plant & machinery for setting up iron ore beneficiation from 7.5 per cent to 2.5 per cent will help to keep our costs competitive,” Essar Steel’s CEO and MD Dilip Oommen said.
The steel industry had been demanding an increase in the import duty of HR and CR coils for quite some time now. In the run-up to the Budget, all leading domestic steel makers had written to the Finance Ministry requesting to double the import duty to 10 per cent.
They viewed duty hike would help protecting the interests of the domestic steel industry and putting a brake on growing imports from China, Russia, Korea and Brazil among other countries.
India imports around six million tonne steel a year. Till January of the current fiscal, it was marginally down at 5.59 million tonnes, against 5.62 million tonnes in the year ago period. The domestic consumption grew by 5.5 per cent to 57.24 million tonnes in the same period.
Tata Steel Managing Director H M Nerurkar said steps to control imports of HR and CR coils and low quality CRGO will help to boost domestic steel industry.
“Initiatives taken to reduce duties on equipment for setting up or expansion of iron ore beneficiation and iron ore pellet plants will provide incentive to use iron ore fines which are at present not being utilised fully,” he added.
SAIL Chairman C S Verma said increase in customs duty for flat carbon steel and reduction in import duty for equipment required in mining and minerals sector -- all the measures are positive for steel industry.