New Delhi, September 19 Steel Minister, Jyotiraditya Scindia, has written to Finance Minister Nirmala Sitharaman, calling for removal of import and customs duty on a variety of steel-making inputs (like manganese and chrome ore, Corex coal, natural gas), abolishing GST compensation cess on coal, among others. Help is sought for making operations of two state-run units – KIOCL and RINL – financially viable.
Scindia has not taken up the issue of withdrawal or phase-out of duty on steel exports. But has sought his Cabinet colleague’s support on taking action against dumping of stainless steel by Indonesia and China to protect domestic stainless steel-makers.
He has, however, asked Finance Minister to consider reimbursement of export duty paid by exporters for pre-contracted orders and those backed by Letters of Credit (LCs).
Help for RINL and KIOCL
The Minister in his letter, which BusinessLine has accessed, mentioned that state-run PSU-steel-maker, RINL is facing “financial difficulties”.
KIOCL suspends operation at Mangaluru pellet plantCites lack of domestic demand, unviable international market and heavy export duty as reasons
“The company is under strategic disinvestment. It is proposed that the forged wheel plant (of RINL) at Rae Bareilly be permitted to be operated in an OnM (operations and maintenance) model by a private company or the unit be considered for being hived off,” it says. Any of the two measures will “generate much required funds” for the steel-maker.
In case of KIOCL (formerly Kudremukh Iron Ore Company Ltd), the iron ore pellet making plant based out of Karnataka – whose operations have been badly hit by export duty levy on iron-ore – Scindia sought exemption from payment of duty.
Export duty on iron ore was hiked to 50 per cent from May 22 onwards.
Duty exemption sought
Custom duty exemption has been sought on natural gas – a clean fuel used by the industry – on the grounds that domestic demand of 174 mmscmd exceeds production (90 mmscmd) by at least 85 mmscmd (imported quantity). Import duty waiver on corex coal (a process used in steel making) on the lines of coking coal and anthracite has been asked for too.
Scindia has also raised concerns on dumping of stainless steel and sought Sitharaman’s intervention to stop such imports or call for “adequate trade remedial measures” like imposing countervailing and anti-dumping duties.
Call for inclusion of steel in RoDTEP (remission of duties and taxes on exported products) scheme as it “would remove structural disadvantage” faced by mills to the “extent of 5–12 per cent of export price” and improve their global competitiveness.
Duty removal on manganese ore (of 2.5 per cent customs duty) and chrome ore (2.5 per cent on import) have been called as the input material is not sufficiently produced here. India has just one per cent of the world’s chrome ore reserves – with the supply being non-lumpy and friable.