Budget 2018: Steel industry demands removal of import duty on raw materials

Budget 2018

Ahead of the budget, the stainless steel industry has asked the government to remove import duty on ferro-nickel and stainless steel scrap.

In its pre-budget wish list, the Indian Stainless Steel Development Association (ISSDA) has sought removal of customs duty on key raw materials used in producing stainless steel.

"The government had removed customs duty on pure nickel in the last budget, it didn't help the industry much since most of nickel used by stainless steel makers is in the form ferro-nickel," the ISSDA said.

The same relief should now be extended to ferro-nickel, it demanded. The import duty on ferro-nickel is 2.5 per cent.

The raw material has to be necessarily imported because India hardly has any nickel resources, the association said.

The industry body also said that since all the stainless steel is produced through electric furnaces, stainless steel scrap is the main raw material which also provides cost effective source of alloying elements like chrome and nickel.

The scrap is also not available in the country and has to be imported, the body said asking the government to bring the customs duty for stainless steel scrap to zero from 2.5 per cent at present.

ISSDA President K K Pahuja said, "It is absolutely necessary to preserve competitiveness of Indian stainless steel industry at a time when government is building new trade relations with other countries and we appeal to the Finance Ministry to remove basic custom duty on both ferro-nickel and stainless steel scrap."

The Union Budget for 2018-19 will be presented on February 1.

Steel Secretary Aruna Sharma had earlier told PTI that along with ferro-nickel, the steel ministry had pitched for bringing down import duty on stainless steel scrap to zero.

The steel ministry had already made a request to the finance ministry in this regard, she had said.

Spare a thought for Finance Minister Arun Jaitley. When Mr Jaitley presents his Budget next month, he must know that he doesn’t have a handle on the all-important number, namely, the growth estimate for India’s gross domestic product (GDP).

The growth in GDP (along with the inflation rate) determines the increase in tax revenue. It also determines the denominator in the fiscal deficit to GDP ratio, perhaps the most closely watched number in any Budget. Mr Jaitley’s estimate of GDP growth of 7.5 per cent for 2017-18 in the Budget for 2017-18 is turning...

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