Iran possibly dumping cheap steel into India via the UAE
Nearly nine months after the Indian government raised compliance requirements for high-grade steel imports, domestic steelmakers are rallying for additional curbs on imports – but only on steel from Iran.
In a letter to Binoy Kumar, the Secretary of the steel ministry, seen by the media the Indian Steel Association has asked for a complete ban on imports from Iran.
As sanctions from Iran prevent US allies from having a direct trading relationship with the Persan nation, the country exports good via transshipment through neighbouring countries. Interestingly, since December 2018, India’s imports of flat steel from the UAE, which is a net steel importer, have risen nearly five times to 65,000 tonnes.
Hence, Indian steel makers contend that the spike in steel imports, which have the country of origin is usually listed as UAE, were actually manufactured in Iran.
Having an existing trade relationship with Iran, whether the goods are shipped from the UAE or not, could put India in a tough spot in its ongoing trade negotiations with the US.
The US recently revoked India’s preferential trade treatment under Generalised System of Preferences (GSP) programme, causing India to respond with retaliatory tariffs. Any further complications, whether it stems from trade with Iran or importing oil from Venzuela, which is in the midst of a full-blown political crisis, could exacerbate the situation.
However, more pressing than the threat of US action against India for its imports from Iran, is the fact that India’s steel producers are being priced out.