The Hindu Business Line : Steel body urges Govt to promote exports to Pak

THE Indian Steel Alliance (ISA), representing the five main primary steel producers in the country, has urged the Government to promote steel exports to Pakistan.

The members of ISA are Steel Authority of India Ltd, Tata Steel, Essar Steel, Jindal Vijaynagar Steel and Ispat Industries.

With the National Foreign Trade Policy likely to be unveiled by the end of this month, the ISA has submitted a list of recommendations to the Government that it feels would be beneficial for the domestic steel industry.

Demanding that the Government promote steel exports to Pakistan, the ISA has said that India, with its close proximity, can easily become major supplier of most items, including steel, to Pakistan.

It has also urged the Government to promote steel services zones for the benefit of the small-scale units. These zones would be clusters of steel units located in the same area and sharing common infrastructure.

Regarding the Duty Entitlement Pass Book (DEPB) scheme, the ISA has urged the Government for introduction of a comprehensive DEPB scheme that would neutralise incidence of taxes and duties levied at all levels. It has also demanded that all deemed exports to be granted DEPB benefits.

Simultaneously, the steel body has demanded foreign currency export credit for exporters at a rate of LIBOR plus 0.25 percentage points.

To streamline the finances of the exporters, the ISA has further suggested that alternative sources of market-driven finance like securitisation of future receivables from exports be promoted along with permission to commercial banks to extend long term guarantees for export securitisation.

The demands made by the ISA also include permission for transfer of fuel needs under the Duty-Free Replenishment Certificate scheme.

On the Duty-Free Credit Entitlement Certificate (DFCE) scheme, the ISA has asked the Government to permit group companies and subsidiary companies of the entitlement holder to utilise service provider's credit entitlement under DFCE.

With regard to capital goods for the steel industry, the steel body has urged the Government to allow second-hand capital goods with a minimum of 10 years residual life through the automatic route.

As of now this is allowed only against a specific import license. Simultaneously, it has also been demanded that interest on delayed payment of duty for certain imports assess under the Export Promotion Capital Goods licence be waived off.

For increased raw material availability, the ISA has asked the Government that export of high grade iron ore with iron content of 62 per cent be discouraged.

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