Udayavni Special

Steel industry seeks duty cut on key raw materials in Budget


PTI, Jan 19, 2020, 4:00 PM IST

New Delhi: The domestic steel industry is seeking reduction in basic customs duty on key raw materials such as coking coal, pet coke, limestone and dolomite in the upcoming Budget.

Finance Minister Nirmala Sitharaman is scheduled to present the Budget for the financial year 2020-21 on February 1.

“Anthracite coal, coking coal, coke, limestone, dolomite are vital inputs for the steel industry. The availability of these items in good quality is declining in the country and the industry has to depend on imports on a regular basis,” industry body FICCI said in its Budget recommendations for the Indian steel sector.

The basic customs import duty on anthracite coal is 2.5 per cent. Since ferroalloy industry plays a vital role in steel manufacturing, it is necessary to make available these reductants at an internationally competitive price to make Indian steel mills more competitive, it said while recommending that customs duty on anthracite coal be reduced to zero from 2.5 per cent.

Met coke, another vital input for the industry, had always attracted the lower and concessional rate of customs duty, it said.

However, the basic customs duty was enhanced from 2.5 per cent to 5 per cent with effect from March 1, 2015. Additionally, anti-dumping duty was also imposed on its imports with effect from November 25, 2016.

“As a result, the cost of this (met coke) vital input in steel manufacturing has gone up necessitating an increase in the price of steel which is acting as deterrence to the competitiveness of domestic products in international markets vis-vis similar products of other countries like China,” it said.

“Moreover, high inputs costs have led to an inverted duty structure in the domestic industry and are acting as a deterrent to government’s Make in India initiative, as domestic producers have less incentive to import met coke. Rather, imports of finished steel goods are preferred,” it said and suggested that duty on metallurgical coke be reduced to zero.

The industry body said exemption available to coking coal was also removed by the government in 2014-15 Budget by bringing it at par with other types of coal and imposing 2.5 per cent basic customs duty.

This amendment has adversely affected steel manufacturers in India. Coking coal is one of the principal raw materials used in steel manufacturing and predominantly used for making coke for use in steel making and thus forms a major part of the final price of the steel, it said.

“Levy of 2.5 per cent of duty on coking coal and simultaneously fixing the import duty of 5 per cent on coke has adversely affected the costing of steel. It is requested to restore the exemption of nil rate of duty allowed earlier to coking coal without any technical definition of coking coal,” it said.

FICCI also recommended zero customs duty on steel grade limestone and dolomite as an increase in steel production has led to rising demand for SMS (steel melting shop) and BF (blast furnace) grade limestone.

Limestone imports have been increasing consistently as the reserves of SMS and BF grade limestone within the country are scattered and there is a capacity limitation of the existing limestone mines in various states.

“In 2014-15 Budget, an exemption was granted to Limestone (CTH 2521) and Dolomite (CTH 2518) for metallurgical use conforming to IS: 10345-2004 (Limestone) and IS: 10346-2004 (Dolomite). While there is no apparent issue in this regard but now all samples which were hitherto not being tested are now being sent to Bengaluru laboratories for testing due to which finalization of provisional assessments are getting unduly delayed,” it said.

“This substantially increases transaction costs and litigation defeating the purpose of benefit of concessional duty. So, it is requested to reduce the customs duty on all grades of limestone and dolomite from 2.5 per cent to nil in line with similar imports from ASEAN countries, without any technical condition,” it added.

Exemption of import duty on ferrous and stainless steel scrap, imposing 30 per cent export duty on graphite electrodes, increase in basic customs duty for certain steel products, reduction of import duty on moly oxide are some of the other recommendations made by Ficci to the Finance Ministry.

Udayavani is now on Telegram. Click here to join our channel and stay updated with the latest news.

Top News

Air Chief Marshal V R Chaudhari takes stock of IAF’s operational readiness in Leh

Pearl not result of foreign body reaction in oysters: Andaman-based scientist’s latest finding

Mangaluru: Class 2 poem ‘Go not to the Temple’ draws outrage of Hindu organizations

Nadahabba Dasara beats Covid fears, boosts tourism prospects

Kerala landslide toll rises to eight as search for those missing on

Govt to decide tax cut on petrol after reviewing the state’s economy: Karnataka CM

India blank Nepal 3-0, win SAAF Championship for 8th time, Chhetri equals Messi with 80 goals

Related Articles More

India has right to 30% stake in Iranian gas field even after contract to local firm

Gold ETFs attract Rs 446-cr in Sep; inflow may continue in coming months on festive season demand

Procurement of expensive aircraft parts to be done after approval of senior official: Air India

HDFC Results: Bank’s Q2 consolidated profit rises 18% to Rs 9,096 crore

IMF hails India’s ‘swift and substantial’ response to COVID-19 crisis

MUST WATCH

Ashwathama | Jumboo Savari Elephant refuses to leave Mysore

Dasara Celebration at Dandeli

NEWS BULLETIN 16-10-2021

Rescue work at Kapu

Mysore Dasara 2021 Jamboo Savari


Latest Additions

My children are the reason for me to carry on, work and live: Mandira Bedi

On Chiranjeevi Sarja’s birthday, Meghana Raj announces her comeback film

Air Chief Marshal V R Chaudhari takes stock of IAF’s operational readiness in Leh

9,000 mobile phones looted from Bengaluru-bound truck, driver beaten up and thrown out of vehicle

UP: Woman ends life by consuming poison, her father alleges harassment by in-laws

Thanks for visiting Udayavani

You seem to have an Ad Blocker on.
To continue reading, please turn it off or whitelist Udayavani.