The domestic steel industry, which has been suffering losses for four seven consecutive quarters got much-needed relief on Wednesday as the central government extended safegaurd duty on steel imports till March 18.
The safegaurd duty will not be applicable to any steel imported which is bought over the Minimum Import Price (MIP) imposed by the government.
The stipulated duty structure states that 20 per cent ad valorem minus anti-dumping duty payable for imports between September 2015 and September 2016; 18 per cent ad valorem minus anti-dumping duty payable for imports between September 2016 and March 2017; 15 per cent ad valorem minus anti-dumping duty payable for imports between March 2017 and September 2017; 10 per cent ad valorem minus anti-dumping duty for imports between September 2017 and March 2018.
The steel industry has been suffering heavy losses due to wanton dumping of steel in India at rates which would barely cover the cost of production of Indian steel makers. Indian steel makers took up this issue with the government last year and appealed that the sector and millions of jobs associated with it are at grave risk if the companies continue to suffer due to falling demand at a time when the loan exposure of this sector to the banks is over Rs. 3 lakh crore.
The government took a sympathetic view of the issue and swung into action to by first levying safegaurd duty followed by MIP.