Today, The Ministry of Finance has raised the basic customs duty on Steel items under chapter 72 & 73 by 2.5-5% in order to discourage import from China & Russia
Budget 15-16 bought some relief to the Indian Steel industry. The basic customs duty on all steel items falling under chapter 72 is raised to 10% vide the notification No. 10/2015 of the Ministry of Finance dated 1 Mar’15. This may restrict imports from China & Russia to some extent.
Flat Products Duty raised to upto 15%
SteelMint assessed from policy documents that the customs duty on prime Flat steel products have been raised from 7.5% to 10%. Whereas products like defective CR Coils, Tinplates W/W & Tin free steel (Ch 7209, 7210, 7212) will now attract a duty of 15% as compared to 10%, earlier.
Long Steel Duty raised to 10%
Similarly, SteelMint assessed that customs duty on Bars & Rods under chapter 72 are raised from 5% to 10% giving some relief to domestic steel manufacturers.
Some Steel manufacturers are looking for further clarity on Clause 89 of the Finance Bill 2015, which proposed these changes.
Official document from the Ministry of Finance effective from 1 Mar’15 cites,
“Tariff rate of Basic Customs Duty on iron & steel (Chapter 72) and articles of iron or steel (Chapter 73) is increased from 10% to 15%. Clause 89 of the Finance Bill 2015 refers. However, the existing effective rate of BCD on these goods are being retained. S.Nos.329A &334A of notification No.12/2012 – Customs, dated 17 Mar’12 as inserted by notification No.10/2015 -Customs, dated 1 Mar’15 refer. Further, it is clarified that the existing concessional rates of Basic Customs Duty in respect of goods falling under Chapters 72 & 73 under S.Nos. 330, 331, 332, 333 & 334 and other similar entries of notification No.12/2012-Customs dated 17th March, 2012 will continue.”
Imports of Steel items
As per industry data available with SteelMint, Steel imports (under chapter 73) in FY14 was 1 MnT Whereas, it was 0.78 MnT in FY15 (Apr’14-Nov’14).
|Total Imports & Exports Long Steel (Apr’14-Jan’15)|
|Bar and Rods||1.38||0.58|
|Total Imports & Exports of Flat Steel (Apr’14-Jan’15)|
|HR Coil/ Strip||2.02||1.23|
|CR coil/ Sheets||1.84||0.59|
|GP/ GC/ Sheets/ Coil||0.38||1.38|
|Tin plates W/W||0.01||0.00|
|Tin free steel||0.07||0.00|
|Total Flat Steel||5.99||3.87|
Qty in MnT