The Indian government’s move to replace the minimum import price (MIP) with antidumping (AD) duty on steel imports and continued protection for steel producers will place at risk thousands of job in small and medium scale engineering product exporting firms, an official at India’s Engineering Export Promotion Council (EEPC) said on Tuesday, February 14.
The EEPC official said that small and medium scale engineering product exporters operated in “fiercely competitive global markets” and continued protection of the domestic steel industry would further push up the cost of product exports. Under these circumstances, small and medium exporters would either have to cut back capacity utilization and even lay-off workers to offset higher costs of production stemming from rising input costs of steel, he said.
While protection from imports boosted the realizations of domestic steel companies, the rising costs of steel has a “debilitating impact on realizations of engineering exports as small and medium product manufacturers are not able to pass on higher input costs to their overseas buyers”, the EEPC official said.
Engineering exporting firms are highly job intensive and long-term antidumping duty and the resultant rise in the cost of production would not be absorbed by these firms, forcing many to shed workforce, the official added.
The Indian government early this month withdrew the MIP for color coated steel products, replacing it with antidumping duties. Antidumping duties have also been extended on hot rolled coil (HRC) and cold rolled coil (CRC). Indian steel ministry officials have said that over the next few months at least 124 steel product categories will be taken out of the purview of the MIP and brought under a more WTO-compliant, antidumping regime.