It is reported that, taking the steel industry by surprise, centre has notified export duty on steel items which was pending since April 29th 2008.
The move comes days after Prime Minister Dr Manmohan Singh’s meeting with the steel industry, which resulted in price cuts in the range of INR 4,000 to INR 2,000 per tonne with the understanding that the government would not go ahead with the export cess.
The industry had also agreed to desist from price hikes for three months and presented Mr Singh with a set of demands which will help in offsetting increasing input costs.
According to a notification issued on May 10th 2008, 15 categories of steel products would be liable for export cess in the range of 15% to 55%. The discussion over export duty on steel items indicates the persisting differences within the government over the proposed steps to curb rise in prices of these products.
While the export duty did not come into effect till the notification was issued, the steel ministry had raised several issues and the commerce & industry ministry had also presented its views.
In the meanwhile, Dr Singh met steel industry representatives last week and cut in steel prices were announced as a mutually acceptable solution. Therefore, the steel industry was under the impression that the export cess would not be notified now.
