The Indian government has announced the removal of the 15 percent export duty on certain long steel products such as bars and rods, angles, shapes, sections as well as pig iron and ingots, with effect as of November 1, 2008.
The tax adjustment in question, which came after a request filed by Tata Steel Ltd and Steel Authority of India Ltd (SAIL), follows the sharp slide in steel prices in the international markets and aims at making exports remunerative and at saving jobs.
Though the international steel markets are still on a downtrend, Indian exporters are hoping this adjustment will bring some relief as regards exporting activities.
The export duties had been imposed on certain iron and steel products in May 2008 and were later modified in June 2008. However, according to the new decision, scrap will continue to be subject to the current rate of export duty as there is shortage of this raw material in the domestic market.
Furthermore, the 15 percent export duty on iron ore fines will be replaced by a specific duty of Rupees 200/mt (approx. $4.1/mt); however, the 15 percent export duty on iron ore lumps will remain unchanged.