- Jindal urges removal of import duty on raw materials in Budget.
- Proposes Basic Customs Duty to counter sub-standard steel imports.
- Highlights the absence of key raw materials in India, affecting the industry.
- Stresses concern about dumping from China, Vietnam, and FTAs.
- DGTR recommends up to 19% duty on dumped stainless steel.
- Calls for protectionist measures to support Indian steel companies.
- MSMEs impacted, facing tough competition and industry exit.
- Anticipates a growth-oriented Budget, government support.
- Industry growth potential highlighted despite import challenges.
- Emphasizes the need for strategic measures in import-export dynamics.
Jindal Addressing the Raw Material Dilemma :
Jindal Abhyuday, Managing Director of Jindal Stainless Ltd, has advocated for significant changes in the 2019 Union Budget. He emphasises the importance of reducing import duties on raw materials, which he says will create a level playing field for domestic competitors. Jindal’s principal concern is the unfavourable impact of low-quality stainless steel products entering the Indian market, particularly from China and Vietnam.
Levying Basic Customs Duty :
Jindal advocates for the introduction of Basic Customs Duty (BCD) on imports, claiming the necessity to counteract the influx of inferior stainless steel products. He emphasises that the stainless steel industry faces a problem due to a lack of certain raw minerals in India, such as ferro nickel and ferro molybdenum. Import duties on ferro nickel and ferro molybdenum are currently 2.5% and 5%, respectively.
Combating Dumping and Ensuring Aatmanirbharta :
Jindal expresses concern over severe dumping from countries such as China and Vietnam, claiming that it puts enormous pressure on Micro, Small, and Medium Enterprises (MSMEs) and impedes the stainless steel industry’s journey to self-sufficiency or “aatmanirbhar.” Referring to an examination by the Directorate General of Trade Remedies (DGTR), he recommends the introduction of protectionist measures, such as taxes, to protect Indian stainless steel firms.
DGTR Recommendations and the Industry’s Plea :
The DGTR has suggested charges of up to 19% on specified grades of stainless steel being dumped in the Indian market. Jindal emphasises the necessity of these measures in mitigating the negative effects of imports on the sector. He urged the government to maintain its constructive initiatives, mentioning the reduction of import duties (2.5%) on raw materials such as pure nickel and stainless steel scrap.
Impact on MSMEs and the Industry’s Growth Potential :
Jindal highlights the impact of imports on MSMEs, stating that they are finding it increasingly difficult to compete with cheaper imports. Many are either shifting to trading or leaving the industry entirely. Despite India’s expanding demand for stainless steel, which has a Compound Annual Growth Rate (CAGR) of 8-9%, Jindal warns that if protective measures are not implemented, imports would continue to exploit this burgeoning market.
Looking ahead to a growth-oriented budget :
Jindal anticipates that the government will take a growth-oriented strategy in the 2019 budget. He emphasises the importance of addressing the stainless steel industry’s problems to secure its long-term growth. Jindal asks the government to consider the industry’s request for protectionist policies that will protect domestic players while still fostering global competitiveness.
The Import and Export Dynamics :
For reference, official figures show that India has been a net importer of finished steel since July 2023, with lower finished steel exports compared to higher imports in November 2023. Jindal’s request is consistent with the industry’s call for strategic actions to balance import-export dynamics and ensure the viability of the Indian stainless steel sector.