Economy

EU asks India to drop mandatory quality testing for steel imports

Amiti Sen New Delhi | Updated on December 05, 2018 Published on December 05, 2018

India has argued that the BIS standards were necessary in order to take into account local manufacturing practices   -  P_V_SIVAKUMAR

Says the requirement for re-testing of imports by BIS labs creates a non-tariff barrier

The European Union has raised fresh objections to India’s decision to extend the Bureau of Indian Standards’ (BIS’) mandatory quality certification system to various steel imports, including stainless steel plates, sheets and strips. It has demanded that New Delhi must accept the tests carried out in foreign accredited laboratories attesting compliance with Indian standards.

“The requirement for re-testing by BIS authorised laboratories of the covered steel products, which have already been tested against the relevant international standards, creates a non-tariff barrier to trade,” the EU said in a statement at a recent meeting of the World Trade Organization’s (WTO) Committee on Technical Barriers to Trade (TBT).

The EU’s fresh complaint follows the Indian Steel Ministry’s decision in June to bring 16 more steel products under the ambit of its quality control. The order, first passed in 2016, now covers 50 carbon steel and three stainless steel products.

India had argued in a previous meeting that the BIS standards were necessary in order to take into account the manufacturing practices of India, and therefore international standards are insufficient.

EU stance

Countering the argument, the EU said in its statement that the procedure is disproportionate for low-risk products and unjustified on health and safety grounds. “The EU steel already complies with internationally recognised standards, as well as with safety and quality standards recognised around the world,” it stated.

Since India is both an importer and exporter of steel and steel products, the government is under pressure, like most other steel producing economies, to keep imports under check. The existing glut-fuelled slump in the steel sector worldwide and unused capacities have been forcing many producing countries to examine various ways to protect their domestic industry.

“Indian steel producers are facing a hard time in the global market because of growing protectionism. The EU itself has been examining safeguard procedures against certain steel imports from India while the US has imposed additional import duties on steel on a handful of countries including India without any provocation,” a government official pointed out.

Interestingly, safeguard duties imposed by India on imports of hot-rolled steel flat products during September 2015 and March 2018 were recently found to be in violation of global trade norms by a WTO panel.

“The mandatory quality standards on steel have been put in place to ensure that sub-standard and harmful items are not imported into the country and not as a measure to check imports. These are applied on the domestic suppliers as well,” the official said.

Published on December 05, 2018

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