Domestic steel majors, along with steel minister Naveen Patnaik and steel secretary A K Basu met finance minister Yashawant Sinha yesterday to seek a `package of concessions' for the industry, which is currently reeling under demand slump.
The industry demands included a fast track mechanism for checking dumping, reduction in excise duty on non-modvatable iron and steel products from 15 % to 10 % and withdrawal of special customs duty on some of the raw materials used in the industry which are currently not manufactured in India. The steel majors also wanted restructuring of the loan repayment schedule of on-stream steel projects, besides a hefty relief on the interest rates. The industry representatives wanted the finance minister to take up this issue with various financial institutions.
FIs have been of late quite worried about their exposures in the steel sector and have even stopped financing any greenfield projects in this sector. While there is a lot of pressure on the Fis to agree to restructuring of the loan repayment schedules of steel companies because of the general slump in the industry, such a decision will have a negative impact on the balance sheets of the FIs.
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According to Patnaik, the ministry has proposed for empowering the anti-dumping authority to initiate investigations suo moto on the basis of `trigger price mechanism'. Under this, the authoroty can fix a bench mark price for each product based on certain criteria including cost of production and when the import price of any of the products corss this mark, it can automatically impose anti-dumping duty on them.
Sinha, while agreeing for the need for a fast track aproach to tackle dumping, said the ministry will evolve an appropriate mechanism for this after consulting the concerned ministries.
According to Mr Patnaik, the finance minister has also agreed to consider the issue of extending the duty entitlement pass book (DEPB) scheme to steel exports throrugh the land route on a case to case basis.
The industry leaders who met the finance minister include JJ Irani of Tisco, Sashi Ruia of Essar, Rajesh Shah of Mukund, Anil rai of Usha India, Rajesh Gupta of Lloyds, V K Mittal of Ispat and BN Singh of RINL.