India extends MIP till Feb 4, 2017 on 19 products

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05 December 2016

India has yet again extended the minimum import price (MIP) on imports of steel products for a further two months in a bid to protect the domestic industry from cheap overseas shipments.

MIP is considered to be a temporary defence mechanism capable of restricting the entry of huge imports into the country from any global producer. Unlike Antidumping or Safeguard which take years of investigation, MIP provides temporary relief and is levied almost immediately after relatively brief examination. Also, Antidumping and safeguard do not cover 100 percent imports like MIP can do.

India imposed MIP for the first time in February 2016 on 173 products. MIP has been extended four times in the last 10 months and the latest extension came on Saturday night. The current extension of MIP is till 4^th February 2017 for 19 products only which include coated steel products.

India is very cautious on its stand on MIP. India had been strenuously reviewing MIP every two months and has reduced the number of products from 173 in February to 19 in October. It shows India’s willingness to introduce a permanent measure instead of relying on a temporary relief for its steel industry.

As often said, “desperate times call for desperate measures” – India had to impose MIP when the certainty of threat of survival of the domestic steel industry was clearly visible due to sharp rise in imports and the banks which started to protest at the rising level of NPAs from the steel sector.

The products removed from MIP are majorly covered under permanent measures like antidumping or safeguard but an uncertainty of infiltration of these products from countries not covered under these permanent measures may still harm the domestic industry in near time.