The first four months of this financial year 2021-22 (April-July of FY 22), witnessed a staggering 177% rise in stainless steel imports into the country as compared to last year (FY 21) average, and a 159% increase from the 2016-17 average, the base year before the imposition of CVD on China.
The surge has been powered by non-WTO compliant subsidies of 20 to 30% provided to their stainless-steel manufacturers by China and Indonesia, which has been proved by the Directorate General of Trade Remedies in India as well as their global counterparts.
The subsidies have created an imbalance in the Indian and international markets, and reduced the competitiveness of Indian products in the domestic industry, causing material injury and persistent financial stress for home-grown businesses. It has also forced the domestic industry to seek redressal from the concerned authorities of the government for the revocation of suspension of CVD on China and imposition of fresh CVD on Indonesia.
“Suspension of anti-subsidy duty with respect to China and interim anti-subsidy with respect to Indonesia announced in Budget FY22, has had an adverse impact on the Indian stainless-steel industry. This opening up of the market for stainless-steel-flat-products imports at dumped/subsidized prices from China, and Chinese investments in Indonesia provided rich opportunities to Chinese/Chinese-backed exporters. The investigation recommended continuing with the duty protection.
However, a sudden change was effected through the budget, and the adverse impact of these decisions has become apparent from the sudden surge in imports. As a result, Indian companies, particularly the MSMEs, have been languishing,” Dr. Aruna Sharma, former secretary, Ministry of Steel said.