Title: Import of stainless steel from Indonesia grows nearly nine times
Import of stainless steel from Indonesia into India has grown nearly nine times from nearly 8,000 tonne in 2017-18 to 67,000 tonne in 2018-19 (annualized basis),with Chinese producers ramping up capacity in Indonesia according to Indian Stainless-Steel Development Association (ISSDA) which has highlighted mis-declarations by exporters from ASEAN countries such as Indonesia, Malaysia, Singapore, Thailand, and Vietnam to avail preferential tariff under the FTA, to the Government of India.
ISSDA has requested the government to impose an ADD/CVD on imports of stainless-steel flat products from Indonesia, to counter Chinese imports, which are now being routed through ASEAN FTA route.
Exporters of stainless steel in several countries are colluding with some Indian importers to misuse the provisions of Indian-ASEAN FTA rules, ISSDA alleged in a statement on Tuesday.
“It must be mandated by the government to clear consignments, with provisional duty by taking bank guarantees, to safeguard the government revenue. Moreover, the government must initiate appropriate actions against erring importers who are not only causing loss to the exchequer but also hurting domestic industry,” said K K Pahuja, President, ISSDA, expressing concern over the matter.
“Chinese investments in Indonesia are backed by Chinese Government subsidies provided to expand in overseas markets. They are also subsidized generously by the Indonesian Government to attract more investment. Since there is hardly any domestic demand growth in Indonesia, all the surplus capacity thus created is being dumped in a growing market like India at an alarming rate,” Pahuja added.
As per official figures released by the Indonesian Government this month, global exports of Indonesian stainless hot-rolled coil (HRC) nearly tripled in the first three quarters of 2018 and are expected to further rise in 2019.
Global exports of Indonesian stainless HRC totaled 877,990 tonne during January to September 2018, a year-on-year jump of 171% from 324,108 tonne in 2017, Indonesia’s Ministry of Industry said on January 28, 2019. Stainless slab exports also rose sharply over the same period by 63.6% to 459,502 tonne, compared to 302,919 tonne in the first three quarters of 2017.
Cold Rolled material from China is exported to Indonesia for minor value additions like slitting into smaller widths, after which, the same consignment is exported to India, ISSADA said. In another method to evade the duties, Indonesia imports Hot Rolled Stainless Steel Coils from China and then converts the same consignment into Cold Rolled Stainless Steel Coils. These Cold Rolled materials are then exported to India claiming preferential duty of zero per cent, measures that have led to losses for the government exchequer, ISSDA pointed out.