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Industry bodies, representing the stainless steel mills and their supplier bodies, across Haryana, Himachal Pradesh, Rajasthan, Gujarat and UT-like Delhi, have written to the Finance Ministry seeking protection from Chinese imports while calling for a level playing field to compete with lower priced Chinese shipments that are pushing Indian MSMEs out of business here.
The letters, addressed to the Revenue Secretary, Sanjay Malhotra, with copies marked to the Steel Ministry, have sought that countervailing duty or import duty be reimposed on such Chinese offerings.
Incidentally, two of India’s largest stainless steel players – Jindal Stainless Ltd (JSL) and SAIL (which operated the Salem steel plant) — have, in two separate letters to the Finance and Steel Ministries, already raised the issue of cheaper stainless steel imports impacting operations.
SAIL while referring to an investigation carried out by the Directorate General of Trade Remedies (DGTR) and its April 6 recommendation, which mentioned that the Chinese products in question – called 200 series – were subsidised and “caused injury”, with players here losing market share to the extent of 20 – 30 per cent.
Reportedly, senior Steel Ministry officials have in an internal note expressed willingness to take a stand on the same.
In a joint representation by four industry bodies, it was stated that some 500-odd MSME stainless steel re-rolling mills – across Jodhpur, Ahmedabad, Delhi- NCR and Jagadhri – have put in an investment of at least ₹10,000 crore. But “due to heavy influx of highly subsidised Chinese imports, many MSME companies have stopped production, with some even switching to trading of goods,” the letter said.
These MSMEs are suppliers to stainless steel industry and mostly cater to segments such as utensils and other household applications. The re-rolling mills generally roll over the hot rolled flat products and these are considered as output of induction furnace producers.
Pointing out that the industry “runs on paper thin margins”, the average profitability of these producers is around ₹500-2,000 per tonne, which translates into 0.5–2 per cent of the product price.
On the other hand, a second group of two industry bodies, representing suppliers to stainless steel industry (called induction furnace producers) – from Gujarat, Delhi and Himachal Pradesh — have in their letter pointed out that the industry is operating at low-capacity utilisation of 40–50 per cent. The segment has lost production of 2.14 lakh tonnes between FY18 and FY23 to imports and some of its members have gone out of business too.
It argued that China’s market share was 10-15 per cent in FY21 and has now increased to 25-30 per cent in FY23. Imports in the category are 30–40 per cent cheaper.
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