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Posted on Feb 07, 02:29PM | IBNS
New Delhi, Feb 7 : Amid growing concerns of Indian steel companies arising out of Free Trade Agreements (FTAs) with Japan and Korea, apex industry body ASSOCHAM on Thursday sought immediate exclusion of steel products under Chapter 72 of the International Trade Centre (ITC) code from the Indo-Korea and Indo-Japan Comprehensive Economic Partnership Agreement (CEPA), in order to ensure the sustainability of domestic steel industry. "Reinstate import duty rates for exports of all steel products from Republic of Korea and Japan to India under Chapter 72 of the ITC code as per the normal prevailing import duty rates," appealed Associated Chambers of Commerce and Industry of India (ASSOCHAM) in a communication to Union Steel Minister Beni Prasad Verma. "On behalf of the Indian steel industry, we at ASSOCHAM have time and again registered the growing concerns of the domestic steelmakers towards the unabated rise of steel imports from Japan and South Korea thereby taking undue advantage of concessional duty rates under the CEPA Free Trade Agreements (FTAs)," said D.S. Rawat, secretary general of ASSOCHAM. "The FTAs should be evolved on the spirit of complementing the need and necessities of partner economies rather than exploitation for self-centric objectives," said Rawat.
"Unfortunately, with large surplus floating steel capacity together with rising steel production and declining demand for steel both Japan and South Korea have amply utilised the concessional duty rates under the CEPA FTA for salvaging part of their surplus steel thereby flooding steel exports into India."
In its submission, ASSOCHAM has also stated that CEPA FTAs are extensively committed to the trade aspects which majorly favour the needs and necessities for exports of surplus manufactured and engineering goods by these countries and have no specific commitment to investment which is the major requirement by India.
"It is imperative that FTAs should focus on investment into manufacturing sector along with infrastructure development in India instead of encouraging import of manufactured goods from partner economies to salvage their surplus into India," said Rawat.
Further, ASSOCHAM has strongly recommended for exclusion of steel products under Chapter 72 from negotiations of the ensuing Indo-Australian FTA.
For all ensuing and "under discussion" FTA proposals, India should not negotiate any duty concessions for steel products under Chapter 72 with all the partner economies having surplus steel and/or the country is reeling under economic slowdown, said ASSOCHAM.
The apex chamber has also specifically requested to the Minister of Commerce and Industry to review the representations from ASSOCHAM sent last year on May 5 and August 6 along with the oral submissions to joint secretary-Commerce (Foreign Trade).