Engineering exporters have urged the government to reconsider the 15% export duty levied on iron and steel products this May, arguing that it was the single most important factor behind the decline in shipments in recent months. may become a challenge in meeting export targets.
Exports from the sector grew just 1.15% to surpass $55 billion in the first half of 2022-23, slightly higher than 43% of the government’s target of $127 billion for engineering goods.
Arun Kumar Garodia, chairman, Engineering Exports Promotion Council (EEPC) India, said, “Our exports have been on a declining trend and have declined by 10.85 per cent in September, which can be mainly explained by falling steel exports.”
Iron and steel exports declined by over 60% in September and contracted by nearly 30% since April, he termed this as a ‘direct result’ of export duties on iron and steel products.
“The decline in steel exports has impacted India’s capacity in various key markets including Europe, North East Asia and Africa. We have requested the government to focus on export duty especially on stainless steel segment as these are major export products for India, mainly produced by MSMEs and there is low domestic demand,” he pointed out.
The council said slowdowns in China and Europe, which account for nearly a quarter of India’s engineering exports, also hurt shipments, and 15 of the 25 major markets registered contraction in September.