Government freezes steel export incentives and cuts duties

By Our Corporate Bureau | 28 Feb 2004

New Delhi: Faced with spiralling steel prices, the Government yesterday decided to freeze all export incentives to steel manufacturers and also decided to drastically reduce customs and excise duties.

The secondary steel sector and small-scale user industries would be provided with an annual subsidy of around Rs 70 crore to enable them to manufacture their products at competitive rates.

The decisions were taken at a high-level meeting chaired by the Prime Minister, Mr A.B. Vajpayee. Those who attended the meeting include the Union Minister of Steel, Mr Braja Kishore Tripathy, and the Commerce and the Industries Minister, Mr Arun Jaitley.

The meeting decided that the Duty Entitlement Pass Book scheme and the duty drawback schemes will be suspended for the time being for all categories of carbon steel which include hot-rolled and cold-rolled steel as well as pig iron. The import duty on coking coal will be brought down to zero from the present five per cent level.

The high-level meeting was preceded by a meeting with representatives of the major steel producers' representative body, the Indian Steel Alliance (ISA).

The ISA has given a written undertaking to the Government that its members would supply steel at Rs 1,500 to Rs 2,000 less than the market price to the small-scale sector.