New Delhi: The government has waived basic custom duty on nickel -- a key steel making raw material -- in a major relief to the steel industry which is facing tough times.
The basic custom duty on nickel has come down to nil from 2.5 percent earlier, according to the Budget document.
Ajani K Agarwal, partner and national leader (Metal and Mining sector) EY said that bringing down the basic customs duty (BCD) on nickel to zero from 2.5 percent comes as a great relief for the stainless steel industry which has been facing challenging times.
"We welcome the move as it will be helpful for the domestic stainless steel industry as they are facing huge challenge of imports. This reduction of BCD on nickel will be mildly positive for domestic industry," he said.
Though the percentage of the stainless steel industry in in the country is small, he said.
Nickel is primarily used in the manufacturing of stainless steel. Jindal Stainless is one of the leading stainless steel producer in India.
The Steel Ministry had earlier written to the Finance Ministry, seeking reduction in import duty on nickel.
Agarwal further said that the reduction of BCD on CRGO steel will help in reduction of the cost of power transformers.
In the budget, the basic customs duty on "MgO coated cold rolled steel coils for use in manufacture of CRGO steel" has been reduced from 10 percent to 5 percent.
He further said that the reduction of BCD on Hot Rolled Coils for captive use in welded tubes and pipes would create price pressure on domestic HR coil producer.
In the budget, the government reduced the BCD on "Hot Rolled Coils, when imported for use in manufacture of welded tubes and pipes" from 12.5 percent to 10 percent.