Auto companies oppose safeguard duty on imports of steel

NEW DELHI: After the engineering sector and exporters, auto industry is the latest to protest against the move to impose safeguard duty on steel, with industry body Siam taking up the issue with the commerce department.
Siam claimed that only “some amount” of specific grade of steel, used by auto companies, is being imported as it is not being produced in India, adding there is “no line of sight when these grades could be potentially produced locally”.
Companies such as JSW Steel – the country’s largest steel maker, which also sells cars under the JSW MG brand – are seeking curbs and duty on imported steel, claiming that Chinese steel is being “dumped” in the country using FTAs with countries like Korea, Japan, and Vietnam.
“We would like to highlight that it is estimated that more than 80% of the steel used for manufacturing of vehicles in India is sourced from domestic mills. However, almost all the manufacturers have to rely on imports of some amount of steel for manufacturing of vehicles as the specified grade of steel is presently not produced by the Indian steel mills,” Siam said in a representation to Directorate General of Trade Remedies (DGTR), which has launched a probe amid calls for a 20-25% duty.
Other user industries have told govt that if the levy is imposed it will push up costs for consumers and also make exports uncompetitive in a choppy environment globally. Siam said the auto industry is “committed to drive localisation” and all major OEMs are in discussions with domestic steel companies to produce the grades. “However, there are specific investments and timelines, which are required to make this feasible locally.”