Budget expectations from Stainless Steel Sector

India Infoline News Service | Mumbai | February 19, 2015 11:56 IST

Taxes and import duty anomalies are critically affecting the stainless steel sector’s viability.

Taxes and import duty anomalies are critically affecting the stainless steel sector’s viability. As a result companies are under severe financial stress. To prevent this, import duties need to be rationalized or scrapped, as required. 
 
Import duty on SS flat products needs to be increased from 7.5% to 10%. (China has 10% duty, while Brazil imposes 14%).
 
Abolish import duty on raw materials:
  • Manganese, chrome, and molybdenum ores, hydroxides and other salts to zero from 2.5%;
  • Nickel is not available indigenously; duty should be abolished.
  • Coking coal from 2.5%; should be abolished.
  • Iron ore from 2.5% to nil, since this is a primary raw material for steel making;
  • Stainless steel scrap from 2.5% to nil;
  • Increase in peak rate of Basic Custom Duty from 10% to 25% for the steel sector.
 
The above measures will help create a level-playing field for domestic steel manufacturer’s vis-à-vis Chinese manufacturers who enjoy subsidies and state protection in multiple ways. In addition to this, domestic manufacturers will be able to utilize capacities which are lying idle.
 

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