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Extending RoDTEP to steel exports under consideration: Steel Ministry official

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New Delhi, November 21 Inclusion of steel exports under the RoDTEP scheme (Remission of Duties and Taxes on Export Products) is under “active consideration”; but Budgetary constraints remain an issue, a senior Steel Ministry official told businessline.

The RoDTEP scheme offers refunds against various embedded taxes to exporters across sectors such as automobiles and agricultural produce.

According to the official, the Commerce and Finance Ministries are looking into the matter. However, the bottlenecks remain. Inclusion in the scheme needs approval of the Finance Ministry as additional Budgetary provisions are needed.

Budgetary allocation for RoDTEP this fiscal was ₹13,699.40 crore, up 10 per cent, as against ₹12,454 crore last year.

Pending demand

“Yes, steel exports are under active consideration for inclusion in RoDTEP ambit. But then there is limited scope because of the Budget allocation issues. So currently, the things are on standby. But as and when Budgetary provisions are made and a new list is announced, steel could find a mention,” the official said.

Sources say, “substantial additional Budgetary provisions” needs to be made to add steel exports. Inclusion of steel exports under the RoDTEP scheme has been a long-standing demand of the industry.

Steel exports have been on a slide since of the beginning of this fiscal (April onwards) as recessionary fears and geo-political unrest led to slowing down of demand.

In October, (steel) exports dipped 66 per cent – amongst the highest for this fiscal – to 360,000 tonnes on the back of weakened global demand and pricier offerings when compared to other competing nations. Exports in October 2021 was 1.05 million tonnes, data available with the Ministry of Steel shows.

Sequentially (October vs September) too exports witnessed a dip of nearly 40 per cent; which was registered across categories that include non-alloy steel, alloyed and stainless steel offerings.

For the seven month period (April to October) exports dipped 55 per cent year-on-year to 3.9 mt. Exports in the year ago period was 8.8 mt. Meanwhile, imports for the period rose substantially by 14 per cent for the seven-month-period to 3.15 mt, up 14 per cent.

Incidentally, the country turned net importer of steel (imports exceeding exports) in October – the second time this fiscal.

Keeping the slide in exports in view, the Finance Ministry decided to withdraw the duty levied on steel and iron-ore exports November 19 onwards.

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Published on November 21, 2022

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