A negative impact on the investors and capacity expansion projects can be seen under the PLI scheme. As its being said that the government removed custom duties on raw materials and hiked export taxes to check local prices.

The custom duty is rejected on the import of some raw materials including coking coal and ferronickel, used by steel industry. A move which will lower the cost for the domestic industry and pull down the prices.

The duty on exports of iron ore was increased up to 50% and a few steel intermediaries to 15% to increase the domestic availability.

The Indian steel Association (ISA) said the industry welcomes the removal of import duty on coking coal and few other input raw materials for the industry. “However imposition of export duty on steel will only send a negative signal to investors in the steel sector and will adversely impact the sector‘s capacity utilisation. India has been increasing its engineering and steel exports over the last two years and has the potential to become part of a larger global supply chain.”

”India may lose the export opportunities now and this decision may also impact the overall economic activity in the country.”,association claimed.

it’s been said that the other countries will be helped due to the imposition of export duties as it will increase their share in the global market which India will vacate.

Rebuilding of lost ground may take very long time as the supply chain will be disrupted while India’s potential as a reliable exporter will take a hit. They also stated “Steel industry in India has made the largest investment commitments ranging from 36% to 40% of total investments committed by the entire manufacturing sector. These investments in capacity building are needed to achieve the Atmanirbhar Bharat Vision

”In light of this decision, new capacities creation may get impacted as they would be seen as uneconomical thus affecting the much awaited investment against PLI scheme for speciality steel.” Besides that, it may have a major impact on the entire supply chain in the long-term. The economic activity of a few states dependent on minerals and steel will be further hit.

The association also mentioned “ These measures need to be deliberated and then a calibrated approach may be taken. The steel industry continues to remian committed to nation- building.”

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