Tax related expenditure is the major factor increasing the cost of steel production in India. To reduce taxes and increase the country’s steel production capacity, the Indian government is likely to publish a white paper on steel industry soon.
The task will be completed within three-four months with the help of NITI Aayog and other ministries, announced the steel minister Dharmendra Pradhan on Monday.
Lesser taxes levied favour Chinese steelmakers, with their production cost lower by $100/mt at $350/mt than India’s. The government has also started the bidding process for 1mn mt of raw material to increase the country’s steel production. Investment of Rs40,000bn for gas infrastructure will also benefit the steel sector, according to the minister.
India is importing high quality steel at present, despite having a large market and skilled labour. The country has imported 1.96mn mt of iron and steel in the Jan-Oct period.