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Safeguard duty on steel imports will hurt SMEs: EEPC |
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NEW DELHI: Engineering exporters' body EEPC India has said the government's decision to extend the safeguard duty on some steel imports is "anti-SME" and will make India's engineering exports uncompetitive.
Government yesterday extended the safeguard duty on some steel imports by two years, till March 2018, to protect domestic industry from onslaught of cheap supplies from China amid a global glut.
The duty will however be reduced to 10 per cent in stages over the next two years.
"We feel this is a completely discriminatory judgement and does not take into account the impact of the negative effect the continuation of the safeguard duty will have on the global competitiveness of user industries," EEPC India Chairman T S Bhasin said.
"While a huge level of protection is being given to the steel units, including those in the large sector, there are reports about further package to them. We have no problem with that but let protection to the one sector not spell death knell for the user industries, which are also battling the global slowdown and domestic demand compression," he added.
He said the Steel Ministry itself has taken note of the fall in steel imports by almost one-fourth in April-February period of the fiscal 2016-17.
"There was no case for continuation of Safeguard duty that too till March 2018 as there are already indications that global prices of steel have started to increase," Bhasin said.
"The continuation of the safeguard duty not only makes engineering exports uncompetitive, but also there is no specific reason for the levy on HR Coils, which is a basic raw material for engineering products,especially when MIP has already been slapped," he added.
The government had first imposed the safeguard duty in September last year. Last month a floor price on imports was set to deter countries like China from undercutting domestic industry, the first such move in more than 15 years.
The duty would drop in stages to 10 per cent for the six months through March 2018. It will be 18 per cent for period between September 14, 2016 to March 13, 2017; 15 per cent during March 14, 2017 to September 13, 2017; and 10 per cent during September 14, 2017 to March 13, 2018.
Facing domestic economic downturn, China had last year raised its exports of steel products, leading to new duties in several markets like India and the European Union, as well as anti-dumping investigations.
Source : economictimes.indiatimes.com
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