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Indian stainless steel industry seeks for lowering import duties on key raw materials

The Indian stainless steel industry has urged the central government to slash the existing import duties on key raw materials in the upcoming Union Budget 2021-22. In its recommendations to the Ministry of Finance, Indian Stainless Steel Development Association (ISSDA), the apex body representing the domestic industry, has appealed to exempt the 2.5% Basic Customs Duty (BCD) levied while importing key raw materials, including ferro-nickel and stainless-steel scrap. Presently, both these raw materials are unavailable in the country, making their import mandatory.

The association has also sought abolition of the existing 7.5% import duty on graphite electrodes, a critical component in stainless-steel manufacturing, as they constitute a major share of input cost. Additionally, ISSDA has sought an increase in the import duty on stainless-steel flat products to 12.5%, to bring it at par with carbon steel products, in order to check undue imports. ISSDA asserted that these measures, if undertaken, will not only boost domestic manufacturing but also curb undesired stainless-steel imports.

K. K. Pahuja, President, ISSDA, said, “The Government has set in motion a wave of reforms to boost economic growth and the Indian stainless-steel industry is ready to contribute to the ‘Atmanirbhar Bharat’ vision. This is the optimum time for the government to stop considering essential raw materials as a source of revenue and provide stimulus to domestic manufacturing by exempting duties on importing critical raw materials. This step will improve the competitiveness of the domestic industry and in turn, provide impetus to the hard hit MSME segment, which has a 40 % share in the domestic stainless-steel industry.”

He added, “Undue imports have harmed the domestic industry which is operating at 60% of its capacity and is financially stressed after Covid-19 related disruptions. We request the government to rationalise the duty structure in order to catalyse the revival of this sector that has immense potential to generate additional jobs.”  

JLL report signals hope for hospitality sector

With the emergence of recovery indicators, the hospitality sector has witnessed a revival demand in the last quarter of 2020, as compared to the previous quarters of the year. Occupancy levels have grown month on month since September 20 to cross 35% sector-wide on November 20, which is the highest since the beginning of the nationwide lockdown on March 20. The revival of the sector has primarily been driven by leisure ‘revenge travel’ during weekends and the festival season, weddings and food and beverage demand.

Goa, India’s most sought-after leisure market, witnessed considerable growth in recent months achieving a market-wide occupancy level of almost 55% on November 20. Luxury and upper upscale hotels in Goa performed well in November 20, achieving healthy occupancy levels ranging between 60% and 70% as compared to occupancy levels in November 2019 that ranged between 65% and 75%.

Jaideep Dang, Managing Director, Hotels and Hospitality Group, South Asia, JLL commented, “Domestic business travel is expected to pick up pace from March-April, 2021 onwards, as employees return to workplaces and travel advisories by companies are softened. Additionally, domestic leisure will continue to drive occupancies across the country. F&B demand will continue to grow as eating out will increase albeit cautiously”

The repurposing of brownfield hotel assets for alternate uses such as co-living, senior living and student housing facilities may start happening.