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Import duty hike needed to protect steel players

Jayanta Mallick
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Steel industry expects a 0.5 per cent increase in duty drawback to two per cent for exports of pig iron and, at least one per cent hike for steel product exports to 3.5 per cent
Steel industry expects a 0.5 per cent increase in duty drawback to two per cent for exports of pig iron and, at least one per cent hike for steel product exports to 3.5 per cent

The steel sector is hoping for protection in view of the 40 per cent jump in imports in first half of FY13.

Smaller players expect safeguard tariff to be put up on sponge iron and other iron variants imports too — from the present five per cent to 10 per cent — in the Budget.

H.M. Nerurkar, Managing Director, Tata Steel, said: “In order to protect the interests of the domestic industry, the Budget needs to revisit last year’s hike in excise duty and take steps to discourage dumping of products in India”.

RINL CMD A.K. Chowdhury said: “I expect an increase in import duty from the current five per cent to 10 per cent for long products, particularly for wire rods.”

The steel industry also expects a 0.5 per cent increase in duty drawback to two per cent for exports of pig iron and, at least one per cent hike for steel product exports to 3.5 per cent, he added.

“I would expect import duty on sponge iron, direct-reduced iron and hot-briquetted iron be increased from present five per cent to 10 per cent in the Budget,” said Vishambhar Saran, Chairman, Visa Steel.

According to Nerurkar, the industry also expects “proactive actions” to mitigate shortage of iron ore and continued delays in project approvals. The Tata Steel MD expects that the five per cent import tariff on steel grade limestone and dolomite as well as the 2.5 per cent duty on iron ore would go.

Sushil Maroo, CFO, Jindal Steel and Power, said the expectation was high that the Budget proposals would provide impetus for spending on infrastructure and boost demand for steel.

“Given the priority accorded to infrastructure in the 12th Plan, and the expectation that the private sector would contribute half the envisaged investment of Rs 50 lakh crore, the Budget should also look at introducing special incentives to encourage capital goods industries,” Nerurkar added.

Saran expected that the Finance Minister would remove the customs duty “anomaly” on both non-coking and coking coal.

“In the last Union Budget, import duty of five per cent ad valorem on non-coking coal was reduced to "Nil", but for want of certain clarity in the fineprint, the Customs Department has still been demanding import duty on certain grades of non-coking coal,” he pointed out.

Kudremukh Iron Ore MD Malay Chatterjee hoped what he called the discriminatory distance-based charge on railway transportation of iron ore fines meant for pellets exports would go.

jayanta.mallick@thehindu.co.in

(This article was published on February 19, 2013)
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