SBB Breaking News - India hikes import duty on flat products to 7.5% from 5%

India hikes import duty on flat products to 7.5% from 5%

India is lifting the customs duty levied on imports of coated and uncoated non-alloy flat steel products to 7.5% from 5%, the country’s finance minister Pranab Mukherjee announced when presenting the national budget for the April 2012-March 2013 fiscal year. The increase would take effect from 00:00 hours on 17 March.

The higher duty applies to flat products of non-alloy steel, whether or not clad, plated or coated under the HS codes of 7208, 7209, 7210, 7211 and 7212, Platts Steel Business Briefing learns from budget documents released shortly after the announcement.

The increase was widely expected, though imports of carbon steel flat products into India have been showing a declining trend lately. Data from the steel ministry’s Joint Plant Committee show India imported some 4.42m tonnes of finished flat products (alloy and non-alloy) during April-December 2011, down 6% year-on-year. About 3.5mt of this was carbon steel products.

“The duty hike may not exactly be based just on market requirement,” a Mumbai-based trader reasoned. “It depends on all the lobbying (by steelmakers) that may have happened in New Delhi.”

Sources however note that the increase in import duty would not apply to Chinese-origin boron-added material which is labeled as alloy steel with a minimum of 0.0008% boron content.

Mukherjee also announced an increase in the central excise duty to 12% from 10% earlier. But steel traders are not very worried about this increase as it is to be borne by the end-user of the product