India to probe steel dumping allegations
15 Dec 2008
India plans to start an antidumping investigation into imports of stainless cold-rolled flat steel products and hot-rolled steel products from China and other countries, Jitin Prasada, minister of state for steel told Parliament last Friday..
Other officials and analysts said separately that a sharp recent decline in imports could complicate any antidumping suit, and the recent imposition of an import tax is already protecting the domestic market from lower-priced Chinese imports.
However, the minister said in his written response to a query from Parliament that local steel prices are generally lower than international prices, so the government would investigate whether imports coming in below domestic prices were being dumped.
India's steel imports jumped more than 70 per cent to 14 lakh tonnes last month against 8 lakh tonnes in the same month a year ago, says a monthly data released by the steel ministry. The sharp rise in imports was due to low-priced shipments coming from China, Thailand and Ukraine into India at $450-500 per tonne, 25 per cent cheaper than the international price, then ruling at $600-700 per tonne.
The steel ministry's Joint Planning Committee that collects data on iron and steel on a monthly basis shows that steel imports dipped 10.7 per cent to 5.25 million tonnes in April-October against 5.88 million tonnes in the corresponding period a year ago. Availability of low-priced imports from some countries resulted in huge imports in November. This happened when domestic steel makers were cutting production due to lower demand.
As demand from major consumers of steel in the automobile, real estate and construction sectors withered, local steel manufacturers cut production or advanced maintenance schedules. Complaining that cheap steel imports are hurting domestic companies, local steel makers have also filed requests with the federal government to impose antidumping taxes on steel imports.
Earlier in the year, the Indian federal government cut duties on local steel and curbed exports to increase supplies in the domestic market. However, analysts said the government's move last month to levy a 5 per cent tax on imported steel is likely to be the most effective shield for the domestic market.
But steel producers feel the move is insufficient to bring down imports as China has withdrawn export tax on some steel products to get rid of surplus stock. The government as also initiated investigation into dumping from China but steel firms feel it's a lengthy process and will take at least 8-9 months to complete.
Countries worldwide are taking proactive measures to safeguard the interests of their domestic industries. The US has fixed a floor price against imports of some steel products from Russia. Even the Chinese government is looking at easing export restrictions further.
