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”AatmaNirbhar” benefits pocketed by large steel sector at cost of engineering exporters: EEPC India

New Delhi. EEPC India , the apex body of engineering exporters has sought an immediate intervention of the government to rein in a sharp increase in steel prices so that the benefits of ”AatmaNirbhar Bharat” are shared widely with the  MSME manufacturing exporters  and not  pocketed by large steel makers. 

In the backdrop of restrictions on imports from China, Vietnam and South Korea, Indian steel makers have raised the prices across different product categories, making the raw material cost for user industries sky-high and leaving the engineering exporters  non-competitive in the international market.

” Engineering exporters who contribute more than 25 per cent to the entire basket of Indian exports would urge the Hon’ble Prime Minister Shri Narendra Modi to enable us to become ‘AatmaNirbhar’ , as per his vision. In fact, we would take this mission around the world, provided we are empowered , ” EEPC India Chairman Mahesh Desai said. He said, ironically, in the manufacturing sector, the protection against imports is largely accruing to steel makers at the cost of engineering industries, particularly those in the MSMEs.  The small firms have suffered the most  under the the Covid-19 impact.      

Steel firms have increased the prices of hot rolled coils by Rs 700-750 per tonne on an average in  July 2020 itself.  Similarly for cold-rolled coils, prices have increased by Rs 500-550 per tonne Prices for Steel pellets have gone up by Rs 300-350 per tonne and for Iron ore fines and lumps byRs   200-250 per tonne . Pig Iron & Steel prices have gone up by Rs. 3,000 per tonne in the local market.

Recently the Government imposed anti-dumping duty on imports of certain types of steel products from China, Vietnam and  South Korea for five years  The duty imposed is in the range of USD 13.07 per tonne to USD 173.1 per tonne on imports of ‘Flat rolled product of steel, plated or coated with alloy of Aluminium and Zinc’ from these three countries.

While it is true that the steel production was adversely impacted due to lockdown and prices  have been going up, the user industries have been hit the most, the EEPC India said.   

According to the World Steel Association (WSA), major steel producing countries barring China are experiencing a decline in  production  India produced 6.9 Mt of crude steel in June 2020, down 26.3% in June 2019. Japan produced 5.6 Mt of crude steel in June 2020, down 36.3% in June 2019. South Korea’s steel production for June 2020 was 5.1 Mt, down by 14.3% in June 2020. The United States produced 4.7 Mt of crude steel in June 2020, a decrease of 34.5% compared to June 2019.

”In such a scenario, the dependence of India’s engineering industry on the domestic steel market is only expected to increase in the coming months. ”

Mr. Mahesh Desai, Chairman of EEPC India said “Immediate intervention of the Government is needed to ensure availability of steel at the export parity price for MSME engineering exporters as this is the question of their survival in these difficult times”.