India will step up curbs on steel imports before the end of the year to combat a rising tide of cheap shipments and aid local producers, according to Steel Secretary Aruna Sundarajan. Shares of Tata Steel and JSW Steel rallied.

The basket of products that face a 20 per cent safeguard tax may be widened beyond hot-rolled coil, Sundarajan said in an interview with CNBC TV18. The curbs, which could include additional measures, may be announced in about two weeks, Sundarajan told the station on Wednesday. India is among countries facing a surge in steel shipments from China, the world's top producer, where slowing local consumption has spurred mills to ship unprecedented volumes. India's plan for additional barriers adds to signs that importers are pushing back with greater vigor against the tide, potentially capping China's exports into 2016.

Govt to tighten curbs on steel imports to aid local producers "In the coming few weeks, India will have tough measures in place to provide a level playing field for domestic producers," Sundarajan said, estimating that imports were set to jump to 14 million tonnes (mt) to 15 mt in the financial year ending March 31. Inbound shipments were 10 mt in 2014-2015, ministry data shows.

Shares jump

Tata Steel rose as much as 3.5 per cent to Rs 245.90 in Mumbai, the highest level since November 2, while JSW Steel gained as much as 1.9 per cent to Rs 962, the highest price since September 18. Steel Authority of India advanced as much as two per cent. In September, India imposed a 20 per cent safeguard duty for 200 days on hot-rolled coil imports, after levying an anti- dumping tax and raising the import duties in the previous two months. India's imports jumped 42 per cent to 6.68 mt in the seven months through October, according to initial data from the steel ministry.

Steel producers globally have been protesting against the rising tide of cheaper supplies from China and have sought protectionist measures from their governments. David Humphreys, a former chief economist at Rio Tinto Group, said last month that there's probably no real scope for Chinese producers to grow exports beyond current levels.

 

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