FICCI Customs duty free for Ferrnickel, Higher import duty for stainless steel flat products
FICCI has urged the government to reduce the basic customs duty on ferronickel to 0
New Delhi:
With the Union Budget just days away, industry body FICCI has urged the government to reduce the base customs duty (BCD) on ferronickel steel to zero and levy a 12.5% higher duty on imports of the products. stainless steel products.
Finance Minister Nirmala Sitharaman is expected to present the budget for the period 2022-23 on 1 February 2022.
Among a series of recommendations, the Federation of Chambers of Commerce and Industry of India (FICCI) has asked the government to continue not imposing duties on stainless steel scrap after March 31, 2022.
Currently, while BCD on ferronickel is 2.5%, the same ratio on stainless steel flat products is 7.5%. For stainless steel scrap, zero customs duty is applicable until March 31, 2022.
FICCI says it is the most important raw material used to make stainless steel. The stainless steel industry fulfills the majority of its nickel requirements through the ferrous and stainless steel scrap routes, as pure nickel is very expensive.
Due to the lack of domestic availability of ferronickel due to a shortage of nickel ore, stainless steel producers have to import it from countries such as Japan, Korea and Greece.
In addition, customs duties do not apply to ferronickel steel originating from Indonesia and Japan due to the India-ASEAN FTA and India-Japan CEPA.
Looking to impose higher tariffs on stainless steel flat products, the agency said imports of stainless steel flat products have increased over the past few months. From a monthly average of 34,105 tonnes during 2020-21, imports surged 127% to 77,337 tonnes in July 2021. These high imports are hurting the domestic industry, which has a high capacity capacity and ability to meet the entire domestic demand.
There is no need to depend on stainless steel imports, as the domestic industry can manufacture all grades and thicknesses required by end consumers, it said.
FICCI noted that the domestic industry with an installed capacity of 5.04 million tons, with a current utilization efficiency of 78%, has enough capacity to increase capacity utilization to meet the full demand. domestically, FICCI noted.
It also said the zero stainless steel scrap tariff has helped the industry obtain the raw materials to make stainless steel at competitive prices, at a time when international stainless steel scrap prices have risen. 25-40%.
The industry is dependent on scrap imports due to less domestic supply. Most stainless steel scrap requirements are met through imports because of the low percentage of locally generated stainless steel scrap.
