Steel CVD unlikely as govt aims to cut price pressure

The steel sector may not see a return of the countervailing duty (CVD) despite rising imports from China and a recommendation to impose the levy, two people familiar with the matter said, given the government’s desire to check price pressures in the economy, and the limited-duration validity of the recommendation.

- Mihir Mishra

The Union steel ministry and the Directorate General of Trade Remedies (DGTR) under the commerce ministry had recommended a 19% CVD to the finance ministry, the ultimate authority in duty matters. The people said, on condition of anonymity, that DGTR recommendations are valid only for three months, and that this one lapses on 5 July, which means the whole process has to begin again.

One of the two people said the government does not want to reintroduce CVD due to the price difference between domestic and Chinese steel, which is 30% cheaper, albeit on account of 20% subsidies provided in China.