Though the Indian steel industry is still groping in the dark about the exact implications of the 7-26 per cent safeguard duty imposed by China on steel imports into the country, leading steel producers in the country and the Indian Steel Alliance (ISA), that works under the aegis of the Confederation of Indian Industry (CII), reported that no orders from China have been cancelled till now. The safeguard duty came into effect from May 24.
"We have received no notification from the Chinese government to cancel the any bookings. Therefore there is no reason for alarm," said Arvind Parakh, finance director, Jindal Strips Ltd. The company is looking at China as one of its main export markets.
A delegation from the ISA recently met the Chinese embassy in Delhi to understand the finer points of the measure. In case there is a code ensuring 3 per cent export business from the developing countries, then India might be bailed out from the policy. "We are still waiting to get the details of the measure. Only then can we decide what steps we need to take in the future," said a senior member of the ISA.
However, according to most producers, the steel industry will not be impacted significantly even if the duty is imposed. According to estimates, China imports only around 2 lakh tonne of steel from India.
"The Indian steel producers export minuscule amounts of steel to China, therefore even if there is a duty, we will not be hit hard," said a member of the ISA.
A senior official at Steel Authority of India Ltd (SAIL) said the company has only a few "lakh tonne" of bookings from China and the safeguard duty is unlikely to have any adverse impact on exports.
In fact in 2001-02, the major markets for SAIL were Thailand, Japan, South Korea, Nepal, Taiwan, Italy. "China was starting to be lucrative but in actual terms, very limited quantity of steel was exported to the country," said the official. However China was turning out to be a major market for the company.
As per the alliance, steel producers in South Korea will be the worst affected with the imposition of the safeguard duty.
