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April 28, 2024

Steel Imports Surge Raises Concerns: Tata Steel CEO Urges Caution

As steel imports continue to surge, Tata Steel CEO T V Narendran has emphasized the need for caution amidst the escalating situation in the steel industry. India has reported a significant 38 percent increase in steel imports, totaling 8.319 million tonnes during the 2023-24 financial year, making the country a net importer of the commodity.

Speaking to PTI, Narendran expressed his concern, stating, “It would be a pity if the situation continues in the long run. We have to be watchful about imports.” He stressed the importance of addressing unfair imports promptly, though he did not delve into specifics.

Narendran anticipates steel consumption to grow by 8-10 percent in the ongoing 2024-25 fiscal year, indicating sustained demand. However, the surge in imports, particularly from countries like China, has raised alarms among steelmakers. They have been urging the government to intervene and protect domestic industries.

“I don’t think reviewing FTAs would be easy. But that’s for the government to decide,” Narendran added, acknowledging the complexity of the issue.

According to BigMint (formerly SteelMint) data, India’s crude steel production saw a notable increase of around 14 percent, reaching 144 million tonnes (MT) in FY24 from 126 MT in FY23. Concurrently, the consumption of finished steel also surged, standing at 136 MT, marking a 13 percent rise from the previous year’s 120 MT.

The surge in imports poses a significant challenge to the domestic steel industry, which has been striving to maintain competitiveness. The industry’s concerns extend beyond mere market share; unfair trade practices and dumping of cheap steel by foreign players threaten to disrupt the balance.

Tata Steel, among other domestic players, has been actively advocating for measures to curb imports and reassessment of existing free trade agreements (FTAs). These agreements, while beneficial in some aspects, have inadvertently facilitated the influx of steel from countries with excess capacities, distorting the market dynamics.

Government intervention is crucial to address the burgeoning import surge and safeguard the interests of domestic steelmakers. This may entail a comprehensive review of trade policies, stricter enforcement of anti-dumping measures, and proactive engagement with trading partners to ensure fair competition.

The steel industry’s resilience amidst the challenges posed by the COVID-19 pandemic underscores its importance as a key driver of economic growth. However, sustaining this momentum requires a conducive environment that fosters fair competition and protects domestic interests.

As stakeholders continue to navigate these turbulent times, collaboration between the government and industry stakeholders becomes imperative. Together, they must devise strategies to mitigate the adverse effects of import surges and steer the steel sector towards sustainable growth.

In conclusion, while India’s steel industry has shown remarkable resilience, the surge in imports warrants vigilant monitoring and proactive measures to safeguard its long-term sustainability.

Jhumpa Lahiri

Jhumpa Lahiri

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