Sunday, December 15th, 2019

Budget Expectations

INVC NEWS

New Delhi, Indian Stainless-Steel industry has now grown to be second largest in the world, next only to China.  India is now the fastest growing stainless steel market in the world. However, Indian per capita consumption of stainless steel is 2 kg against the world average of 6 kg. Therefore, there is a huge potential for growth. The Indian Stainless Steel industry expects to grow at about 8 to 9% and achievement production of about 5.5 MTPA by 2022 from present level of about 3.5MTPA. Positive policy support from Make in India and investment in infrastructure, smart cities and railways is expected to provide impetus for further growth. It is estimated that India has enough capacity to take care of this growing demand. Global stainless-steel producers have been targeting the growing Indian market, since most of them face slowdown in their own countries.  Therefore, Indian Stainless Steel Industry has been asking for a level playing field from the Government to improve its output. In this context, Indian Stainless Steel Development Association (ISSDA), the apex industry body, has appealed for custom duty relief on key raw materials like: (i) Ferro-Nickel: This key raw material has to be necessarily imported because India hardly has any Nickel resources.  Currently, the custom duty of Ferro-Nickel is 2.5%, which should be made zero. While, Government had removed custom duty on pure Nickel in the last budget, it didn't help the industry much since most of Nickel is used by stainless steel makers in the form Ferro-Nickel. Therefore, the same relief should now be extended to Ferro-Nickel. (ii) Stainless Steel Scrap:  Since all the stainless steel is produced through electric furnaces, Stainless steel scrap is the main raw material which also provides cost effective source of alloying elements like Chrome and Nickel. The scrap is also not available in the country and has to be imported. Therefore, the custom duty for stainless steel scrap should also be made zero from current 2.5%. While on the subject, President, ISSDA, Mr. K.K.Pahuja said “it is absolutely necessary to preserve competitiveness of Indian Stainless Steel Industry at a time when Government is building new trade relations with other countries and we appeal to the Finance Ministry to remove basic custom duty on both Ferro-Nickel and Stainless Steel Scrap”.

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