The continued influx of Chinese steel imports into India will negatively impact the sector’s growth and could also affect investment levels, said Dilip Oommen, CEO, ArcelorMittal Nippon Steel India (AM/NS India).
According to him, companies cannot continue to make investments, including those towards decarbonisation, if they are operating at a loss.
He told businessline on the sidelines of the annual conclave of the Indian Steel Association, “If imports continue as they are now, the steel industry will not be able to expand. It needs to grow, but how can you grow if you’re in the red? If you’re not making profits, how will you reinvest? You also need to reinvest in addressing climate change and decarbonisation.”
Imports from China have risen by 42 per cent year-on-year for the April–July period of this fiscal year, reaching 0.81 million tonnes (mt).
According to him, representations have been made to the Centre regarding the need to “combat” steel imports.
“We need to look at what other countries have done—what the USA and Canada have done, what the European Union is doing, or even what other Southeast Asian nations are doing. This includes considering measures such as anti-dumping duties or increasing the Basic Customs Duty (BCD),” Oommen said.
India’s steel industry, in the face of rising influx of imports of the metal, is calling for an imposition of import duty, especially for shipments from China and some other South East Asian nations. The industry has also been seeking a review of the FTAs with some of these countries.
The idea of proving an injury in order to initiate a trade measure while being an outdated approach, could lead to to more damage. “Industry should not get into ICU” by the time action is initiated, he added.
“Just look what USA did; what Canada is doing. They are doyens of WTO. Just follow them,” Oommen said, while pointing out that it was for the Centre to decide on the quantum of such trade measures.
Reduction in steel-making input cost is not in proportion to that of the fall in steel prices in domestic markets. At the same time, downstream or end-user industries of steel have not brought down price of their offerings either.
Steel prices in India have seen a 37 per cent-odd decline from May 2022 levels.