China is dodging duty wall to continue dumping stainless steel in India
Responding to the Indian government’s move to levy 18.95 per cent countervailing duty (CVD) on direct imports from China, companies from that country have started using the Indonesian route to continue dumping stainless steel into India.
Over the past couple of years, investors have installed three million tonnes of production capacity in Indonesia against that country’s total consumption of 150,000 tonnes. Indian stainless steel producers fear that the new capacity installed in Indonesia is primarily coming in from Chinese companies, whose aim is to continue dumping the product into India under the South Asian Free Trade Area (SAFTA).
“The stainless steel industry is facing several challenges such as high cost of finance, regional and free trade agreements (FTAs) signed with partner countries, said Abhyuday Jindal, Managing Director, Jindal Stainless Ltd. He asserted that the capacity build-up in Indonesia is posing another threat to an already beleaguered sector in India.
India has a total stainless steel production capacity of 5.4 million tonnes which is underutilized. With an estimated consumption of 3.2 million tonnes per annum, India’s capacity utilisation stands at around 70 per cent. This means nearly, 30 per cent installed capacity remains idle.