The government has imposed a countervailing duty of 18.9% on hot and cold rolled stainless steel coming in from China. This move has been decided to safeguard the domestic industry from the cheap imports coming in from the China.
The Central Board of Excise and Customs told that the said these products were coming in the country at subsidized rates and injuring the local steel industry. The local steel industry welcomed the move and told that the domestic players will now have a level field to compete.
This duty will remain in effect for five years. The Directorate General of Anti-Dumping and Allied Duties (DGAD) found that Chinese imports at subsidized rates had surged and the local industry was facing losses due to this. In an inquiry, it was found that 81 known subsidies were given by China. These subsidies were divided under five heads which included grants (0.55 per cent), export financing (0 per cent), tax and VAT incentives (2.3 per cent), provision of goods and services (15.78 per cent) and preferential loans and lending which made up totally a whopping 18.95%.
This inquiry and investigation had been started by DGAD on April 12 last year when they saw a significant rise in imports of flat stainless steel items at subsidized rates. “These imports were distorting the domestic market, which was under huge stress and was leading to financial stress in the industry. Extensive investigations were carried out by DGAD and the final findings were issued by DGAD vide notification July 4, 2017,” was told by steel ministry.
Aruna Sharma, the steel secretary told that “This is the first case of imposition of CVD on any steel product in India. This would provide the much-needed relief to the stainless steel industry from subsidized imports from China.” Sharma also told the government has made other moves to help the domestic stainless steel industry as well like ordering the stainless steel quality control order (QCO) and many other trade remedial measures. The countervailing duty is specific to the country and is charged to protect the domestic industry from any trade subsidies that may be unfair and are being given exporting nations’ governments.