Steel, aluminium export quota to US at 336K metric tonne
The US has allowed imports of 336,000 metric tonne of steel and aluminium from India without paying additional duties that were imposed under a national security law by the Trump administration. To conduct this trade smoothly, a joint monitoring mechanism would be set up, a senior official said Tuesday.
In return, India has assured the US that it would remove retaliatory tariffs it had imposed on eight items including almonds, apples, chickpeas, lentils, walnuts, boric acid and diagnostic reagents. India had imposed 20% additional duties on apples, walnuts and lentils.
“Of the total quota, the US has already cleared imports of 1.47 lakh metric tonne of steel and aluminium till now,” additional secretary in the department of commerce Peeyush told reporters.
He said the joint mechanism would officials meet every six months to ensure that it is functioning smoothly, adding that 336,000 metric tonne is the initial quality and the US could even increase it.
“We have requested steel and mines ministries to designate an officer from their side who will be talking to stakeholders and exporters that applications are being properly processed,” Kumar said.
The additional import tariffs of 25% on steel and 10% on aluminium were imposed in 2018 by the US under a national security law. These additional taxes later came to be known as Section 232 tariffs. This resulted in retaliatory tariffs by India on 28 products imported from the US.
Both these measures were challenged by the opposite parties at the World Trade Organisation (WTO). The challenge to steel and aluminium duties also came from other countries and these were later settled bilaterally by the US. Settlement with India came two months back.
India and the US agreed to settle six disputes at WTO when Prime Minister Narendra Modi visited the US.
For exporting steel and aluminium to the US without paying additional duties, the importers and exporters would have to formally seek exemption.
Around 70% of steel exports and 80% of aluminium exports from India to US will get exemption from the additional duties.
Of the total $13.3 billion worth of iron and steel exports, 6.78% went to the US while of the $9.7 billion worth of iron and steel products exports, the US accounted for 31.54%.
Apple, walnut duty cuts to not hurt local growers
Before the visit of US President Joe Biden for the G-20 Summit, India had removed additional duties on apples and walnuts. This move has taken a political turn in Kashmir where political parties have asked for a rethink on the move.
Kumar said the move would not lead to a surge in imports of apples and walnuts from the US and hurt local growers as duties have been brought down to the levels at which other countries are exporting these products to India.
The premium end of the market for imported apples are being catered to by Turkey, Chile, Italy, Iran and New Zealand. The US was pushed out of that market because of the additional duties and now it would be able to complete. The import duty of 50% on apples would stay.
With additional duties imports of apples from the US had dropped to $5.27 million in FY 23 from $145 million in 2018-19.
Same is the case with walnuts. Walnut imports from the US dropped to 3,800 tonne in 2022 from 8,663 tonne in 2018. With the reduction of additional duties, the market for imported nuts would have another competitor but local players will continue to hold on to their space. On walnuts, customs duty is 100%.
