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The government’s move to remove import duties on stainless steel has resulted in Chinese and Indonesian companies dumping their products into the Indian market, cornering up to 40% market share, according to Abhyuday Jindal, the managing director of Jindal Stainless Ltd, India’s largest manufacturer of the alloy.
Import duty on stainless steel duty was first suspended during the union budget of FY22 and then completely scrapped in the latest budget. This has resulted in a sharp increase in the import of stainless steel from China and Indonesia.
Import of stainless steel from China and Indonesia went up by 184% in FY22 compared to the preceding year, accounting for a fourth of India’s consumption. The share of imported stainless steel from these countries was as high as 40% in the month of January, Jindal claimed.
“The biggest threat is imports,” he told ET in an interview. “And this has happened purely because last year our finance ministry removed duty on imported steel without any investigation, without checking with the industry or the steel ministry.”
In her budget speech in February, Finance Minister Nirmala Sitharaman had announced the scrapping of anti-dumping and countervailing duties on stainless steel “in larger public interest considering prevailing high prices of metals.”
However, Jindal argued that the dumping of imported stainless steel was hurting Indian MSMEs. There was no rationale for scrapping the import duties when the whole world has levied imported duties on Chinese and Indonesian stainless steel, he said.
Data show that major consumers like the US, Europe, Brazil and Korea have duties of 17-190% on Chinese and Indonesian stainless steel. Even China levies a 20.2% anti-dumping duty on Indonesian steel. Whereas there are no such duties levied by India.
“Our margins are also getting hurt because of this influx of imports. But being a large player and having various economies of scale, we’re able to export and still maintain our margins,” Jindal said.
“But the secondary stainless-steel players or smaller companies, they are absolutely getting killed.”
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