India steel ministry unlikely to seek new curbs on cheap imports, government source says

New Delhi: India's steel ministry is unlikely to push for any new measures to curb cheap imports in the near term, turning down a request from domestic steelmakers, according to a government source with direct knowledge of the matter.

India, the world's second-biggest crude steel producer, was a net importer of finished steel in April-August, shipping in 3.5 million metric tons of the alloy, up 29.5% from a year ago. China accounted for 31.8% of imports, making it the top exporter of finished steel to India in the period.

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India launched an anti-dumping probe into hot-rolled steel imports from China, Japan and Russia in June.

New Delhi had last December imposed import tariffs, locally known as a safeguard duty, on some grades for three years.

There has been a surge in imports despite the measure. Last week, the federal steel secretary said imports were a challenge.

A steel analyst said there was a petition from a steel mill to raise the safeguard duty above 20% from the current 11.5%.

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But the government source said no hike was planned at present because steel prices were already high. The source spoke on condition of anonymity because the import policy is confidential.

India's steel ministry did not respond to a request for comment.

In recent weeks, mills have lifted prices on the back of rising prices of coking coal, a key raw material, and a strong demand revival after the monsoon rains.

Demand from infrastructure and automobiles has been rising, industry executives said.

India's automobile sales rose 31.82% year-on-year in September, driven by strong demand for two-wheelers and passenger vehicles, an auto dealers' body said on Tuesday.

Higher imports remain the key risk to Indian steel producers' margins if competitive pressure resurges, Fitch Ratings said in a report on September 1.