India imposed a 15% export tax on eight steel products on Saturday as steelmakers try to offset weak local demand by boosting market share in Europe, whose deliveries were affected by Russia’s invasion of Ukraine. .
“It should have taken us at least 2-3 months, we didn’t know about such a substantial policy,” Sharma told Reuters in an interview.
Sharma said Indian steelmakers have pending orders of about 2 million tonnes, mostly to Europe, which are stranded in ports or at various stages of production.
“This could lead to force majeure. And the client was not wrong here and does not deserve to be treated that way,” he said.
Russia and Ukraine exported 46.7 million tonnes of steel in 2020, largely to the European Union, the world’s second-largest steel importer, according to the World Steel Association.
India’s decision could increase the industry’s costs by up to $ 300 million, he said.
“Only we have orders of 260,000 tons, which were taken when the export taxes were zero,” said Sharma.
JSPL, India’s fifth largest crude steelmaker, competing with Tata Steel, JSW Steel, SAIL and ArcelorMittal Nippon Steel India intended to increase its exports by up to 40% in sales, mainly in Europe.
Steel export taxes are part of a series of changes to essential goods taxes aimed at controlling retail price inflation, which has peaked over the past eight years.
Eliminating import duties on coking coal, PCI and anthracite coal and imposing an export tax on iron ore, all key raw materials used in steelmaking, may not be enough to mitigate the blow to exports, Sharma said.
“Coking coal prices are still very high,” he said, adding that the export tax would benefit local carmakers and other heavy engineering industries.
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