The duty will be enforced for 200 days while a final determination is pending.
India’s Directorate General of Trade Remedies (DGTR) has recommended a provisional safeguard duty of 12 per cent on steel imports coming in, including those coming in from China and Vietnam, “to eliminate the serious injury and threat thereof to the domestic industry”; signalling a major relief for India’s steel mills.
The duty will be levied for 200 days, pending the final determination of the probe.
However, imports originating from other “developing nations” other than China and Vietnam will be exempt.
The preliminary findings report mentions, “there is a recent, sudden, sharp and significant increase in imports into India, causing and threaten to cause serious injury to the domestic industry (and also) producers of the products under consideration.”
“Authority considers that a provisional safeguard duty of 12% will be appropriate to eliminate the serious injury and threat thereof to the domestic industry,” the report said.
CRITICAL CIRCUMSTANCES
“There exist critical circumstances, where any delay in application for provisional Safeguard measures would cause damage which it would be difficult to repair,” the report said adding that: “there is a necessity for immediate application of provisional Safeguard measures”.
Imports of the metal from China and Vietnam individually account for more than 3 per cent of the total shipments into India; where as imports from all other developing countries individually are less than 3 per cent.
Further, the collective share of imports from developing countries (excluding China PR and Viet Nam) does not exceed 9 per cent of the total incoming shipments.
“Therefore, the imports originating from developing countries except China and Vietnam, shall be exempt from the levy of Safeguard Duty,” it said.
Products on which duties will be imposed include hot rolled (“HR”) coils, sheets and plates, HR Plate Mill Plates (“PMP”), Cold Rolled (“CR”) coils and sheets, Metallic Coated Steel coils and sheets, whether or not profiled, including Galvanneal, Coated with Zinc or Aluminium-Zinc or Zinc-Aluminium-Magnesium (”Coated”), and Colour Coated coils and sheets, whether or not profiled (“CC”).
Exclusions have been granted for stainless steel imports, including selected speciality products like Cold Rolled Grain Oriented Electrical Steel (CRGO), Cold Rolled Non-Oriented Electrical Steel (CRNO) coils and sheets, Coated - Electro Galvanized Steel, Tinplate, Nickel Coated / Nickel Plated Cold Rolled Steel; Rubber Coated Steel; Electro Galvanised (EG) – Zinc Nickel Coated Steel; Bi-Metal Steel, Brass Coated Steel Wire and Aluminium Coated steel, the probe findings said.
PRICE LIMIT
The DGTR, in its probe, has also mentioned a price limit. This means steel or metal products above that price point will not carry a safeguard duty.
For instance, if HRCs are imported at a price upwards of $675 per tonne on a CIF (cost, insurance, and freight) basis, then there will be no safeguard duty imposition.
Similarly, the price limit for hot-rolled plate mills has been decided at $695 per tonne, while for CRC, the import price limit is $824 per tonne. For coated and color-coated steel, the DGTR recommends price limits of $891 per tonne and $964 per tonne, respectively.
The quasi-judicial body further maintained in its findings that the objective is to protect the Indian domestic industry against the surge of imports.
OTHER COUNTRIES
Trade diversion due to the protective measures imposed by the United States has been a major cause of the surge in imports.
To counter the effect of trade diversion from the USA into EU countries, the EU imposed a 25 per cent safeguard duty in 2018 itself.
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