Steelmakers bat for export duty cut

GoI has levied a duty of 15% on pig iron, non-alloyed steel, bars, rods and flat rolled products of stainless steel. As high as 45% is collected on iron ore pellets. What is worrisome is the fact that export duty has gone up from 30% to 50% on iron ores

Visakhapatnam: The imposition of customs duty on various steel products has upset the steel industry with the major manufacturers worried over their calculations threatening to go haywire in the financial year.

The Indian Steel Association has already represented to Union Finance Minister Nirmala Sitharaman to either abolish or cut the customs duty levied on May 22. Ironically, the steel industry is upset that the domestic demand has more or less remained mutated and the overseas hit hard following imposition of export duty.

The Government of India has levied a duty of 15 per cent on pig iron, non-alloyed steel, bars, rods and flat rolled products of stainless steel. As high as 45 per cent is collected on iron ore pellets. What is worrisome is the fact that export duty has gone up from 30 per cent to 50 per cent on iron ores.

Rashtriya Ispat Nigam Ltd (RINL), the corporate entity of Visakhapatnam Steel Plant which produces various products under the brand name Vizag Steel, is also facing the impact of customs duty hike.

The increase in export duty will have a negative impact on exports thereby affecting the sales volume which may create major financial issues in coming months, feels Katam SS Chandra, President of Steel Executives Association (the recognised officers' body of RINL).

RINL has earned revenue from steel exports Rs 4,043 crore in FY 2020-21 (total turnover Rs 17,980 crore) and Rs 5,607 crore in FY 2021-22 (total turnover Rs 28,008 crore). Since the last two financial years RINL has shown impressive growth in exports-one of major factors for huge turnover compared to previous years.

Chandra told Bizz Buzz on Wednesday, "Imposing higher exports duty not only impacts RINL but also its not a good move to the entire Indian steel industry." He said it may help other countries to increase their share in the global market impacting the entire supply chain in the long run.

SEA General Secretary KVD Prasad said, "There is a lot of scope for export of intermediate (Steel Melt Shop-2) and finished products of Medium Merchant and Structure Mill due to the Russia-Ukraine war."