Steel ministry sources have indicated that the government is considering a 2.5 percent import duty hike on flat and long steel products. As reported, there is great exposure to the steel industry as mentioned by Reserve Bank of India (RBI) governor Raghuram Rajan today.
Just a few months back, there was a 2.5 percent hike, which resulted in import duty being hiked to 10 percent from 7.5 percent. Though this is being considered by the top level at the Prime Minister's Office (PMO), sources say daily check on these issues of the steel sector are being considered from the PMO. The commerce ministry has also indicated that the steel industry should come with its association and ask for safeguard duties which are being considered where companies like JSW , Essar Steel and others have put in requests for safeguard duty, which may come in to effect in three-four months.
Safeguard duty is for a short duration which is right now at zero percent but it can go up to 30-40 percent on hot-rolled coil which is the biggest issue for the steel industry right now.
Some announcement to the effect is likely since things are being discussed at the revenue secretary, finance secretary and the PMO's office level.
Source:moneycontrol