Concerned about the rising demand for steel imports, particularly in certain auto-grade and capital goods categories that are not covered by Indian Standards, the Steel Ministry is considering specific interventions for these non-standardised products and plans to scrutinise shipments of steel entering the country.

A meeting has been called on October 4 where discussions on products being imported, and currently outside the purview of quality control orders, will be taken up.

The ministry is already in favour of doubling customs duty on imported steel, including from China, while it is in discussion with the commerce ministry to review FTAs with ASEAN, ministry sources told businessline.

In a recent letter to the Department of Revenue, the Steel Ministry, citing an internal assessment, mentioned that the latter would look at “reducing NOC granted for imports from non-BIS licensed manufacturers”.

It also pointed out the need for “review of Bureau of Indian Standards (BIS) licences granted to foreign manufacturers and discretion to be exercised at the time of renewal of existing licences.”

The Ministry is also in favour of no new BIS licences being issued for next one year.

Need for Intervention

“It has been observed that a significant number of NOC requests are being received for the import of steel grades currently not covered by the Indian Standards notified under the QCO. To minimize non-BIS imports, there is an urgent need for interventions,” stated an official from the technical division of the Steel Ministry in an email sent to various stakeholders, including automobile manufacturers, steel mills, importers, and exporters.

Communications have also been sent to the Director General of Indian Standards and the Chairman of the CBIC, Department of Revenue (businessline has reviewed a copy of the email).

The e-mail additionally mentions that the meeting will be chaired by the Union Steel Secretary.

A Steel Ministry official stated that some of the import requests pertain to CRGO steel (cold rolled grain oriented), which is primarily used in transformers and other electrical devices. Additionally, several auto-grade steels used in car manufacturing and certain alloy steels required for capital goods are also under review.

Approval from Ministry

The current QCOs cover about 151 categories of steel and steel products.

As of October 2023, the regulations state that all steel imports not cleared by the Bureau of Indian Standards (BIS) must obtain approval from the Steel Ministry. The ministry has established a technical committee to review applications for clarification on whether non-BIS certified products fall under the Quality Control Order (QCO). Importers lacking a BIS license are required to seek clarification for each imported steel consignment via the QCO Portal.

The Ministry of Steel also issues No Objection Certificates (NOCs) for steel products that have different specifications and are not covered by the mandatory BIS certification list.

Chinese Imports Surge

Incidentally, India has already seen an increase in Chinese imports of the metal – up to a five-year high (for the five month period) of 1.14 million tonnes (mt) for April – August period.

Imports were up 32 per cent Y-o-Y.

Five categories -- stainless steel at 0.43 mt, galvanised pipes at 0.16 mt; plates at 0.15, HRCs at 0.18 mt and pipes at 0.08 mt -- make up 90 per cent of the imports.

The country is already a net importer of steel (for FY24). And, in the first five months of the fiscal (April – August) it continues to remain so, with the trade deficit widening to ₹14911 crore. In April – August (5M FY25) steel imports stood at 3.72 mt, up 34 per cent; and HRC and CRC were the major categories.