New
BIS Framework for Steel Products - ECONOMY
NEWS:
The government aims to bring additional steel products under the Bureau of
Indian Standards (BIS) framework.Plan includes revising the classification of
steel standards to cover minor variations in imported products, thereby
increasing scrutiny.
WHAT’S IN THE NEWS?
Objective: Prevent Steel Dumping
·
The revised standards are intended to curb
unrestricted imports of cheap steel, primarily from China, the largest source
of steel dumping in India.
·
Dumping refers to imports sold at prices
below production costs, which undercuts the domestic industry.
Expanded Definition of Steel Grades
·
The government seeks to include all steel
categories with minor deviations under BIS-defined steel grades.
·
Any remaining unclassified grades will
have new standards defined by BIS within the next six months.
Reduced Need for No Objection Certificates
(NOC)
·
Once standards are updated, NOCs from the
steel ministry will only be required if a steel grade is not manufactured
domestically or if import quantities are minimal.
Current Standards and Certification
Process
Existing Steel Standards
in India
- India
currently has 151 standards that cover 1,375 grades of steel.
- BIS
certification is mandatory for exporters, who must obtain a BIS license
to comply with Indian quality standards.
Challenges with Current NOC Requests
- Absence of
strict grading standards results in frequent NOC requests, which often
facilitate the import of low-cost, non-conforming steel.
- The steel
ministry faces an overwhelming number of these requests, necessitating
stricter measures.
Appointment of Technical Consultant
- The steel
ministry has appointed Mecon as a technical consultant to assist BIS in
identifying and defining new steel standards to further restrict steel
dumping from China.
Background on Rising Steel Imports
Surge in Steel Imports
·
India’s steel imports rose by 41.3% from
April to September FY25, reaching 4.7 million tonnes.
·
China contributed 31% of these imports,
with South Korea and Vietnam accounting for 26% and 8.4%, respectively.
Concerns Over Vietnam as a Dumping Channel
·
Chinese companies reportedly use Vietnam
to funnel steel into India, flagged by Indian government departments.
·
Vietnam’s steel imports to India amounted
to 40,000 tonnes in the same period.
Benefits of the Expanded Certification
Process
Supporting Domestic Steel Industry
- Expanded BIS
certification will create a level playing field by ensuring imported
steel meets high-quality standards, benefiting local manufacturers.
- Aditya
Shrivastava from Jindal Steel and Power highlighted that quality
standards boost consumer confidence in Indian-made steel, potentially
increasing domestic demand.
Preventing Loopholes in Compliance
- Enlarged
certification standards prevent foreign manufacturers from bypassing
regulations by making minor product modifications.
- This
stringent approach ensures fair competition and upholds the quality of
steel products available in the market.