Anti-dumping duty on stainless steel may not protect domestic players

Imposition of countervailing duty (CVD) of 21-23 percent on the stainless steel flat products imported from Indonesia effective from August is unlikely to protect the domestic players fully as such trade remedial measures have been responded with side-stepping tactics by exporting nations, by exploiting India’s Free Trade Agreements with other countries.

- Sumit Maitra

Industry expects government to continue its support to curb such circumventions even more effectively.

“In the lack of an anti-circumvention law on CVD, re-routing of Chinese origin material through various countries in ASEAN region continued unabated during the quarter and the year. Over and above this, the competitiveness of the industry was also affected on account of low import duty on finished stainless steel flat products (7.5 percent) as against the import duty on finished steel products (12.5 percent),” Managing Director, Jindal Stainless Ltd, Abhyuday Jindal, said.

Acknowledging the substantial injury caused to Indian stainless steel producers by Indonesian imports through non-WTO compliant subsidies offered by the Indonesian government, the Government of India has imposed provisional trade remedial measures on Indonesian imports.

“In the lack of an anti-circumvention law on CVD, re-routing of Chinese origin material through various countries in ASEAN region continued unabated during the quarter and the year. The competitiveness of the industry was also affected on account of low import duty on finished stainless steel flat products.” Managing Director, Jindal Stainless, Abhyuday Jindal

SS sector margin reduction with increasing imports

Note: SS sector margin (LHS) has been calculated using sample of Ind-Ra rated stainless steel sector entities and listed companies. India Imports (RHS)Source: lnd-Ra, CMIE