Steel Ministry has pitched for addressing the inverted duty structure in the sector in the upcoming Budget in a bid to protect the domestic industry, which is facing an onslaught of cheap imports and weak prices.
It has also asked the Finance Ministry to raise the peak duty rate from the present 15 per cent to 25 per cent, a Senior Government official said. Budget for the 2016-17 fiscal will be presented by Finance Minister Arun Jaitley in Parliament next week. “Ministry has written to the Finance Ministry to re-look at the inverted duty structure, which is making import of raw materials such as coking coal, iron ore costly and is leading to an escalation in the operational costs of the steel firms,” the official said.
The increase in input costs is adversely impacting the competitiveness of the domestic steel industry, which is already facing the issue of cheap imports, he added. Another official said that customs duties levied on key raw materials such as coking coal, iron ore and metal scrap are higher than those on the end product.