Safeguard measures like MIP and anti-dumping duty have been levied to protect domestic steel firms from cheap imports, but they cannot be "perpetual", Steel Minister Chaudhary Birendra Singh said today.
"When I talk to industry people, I said okay for the time being we can have these protection measures, but not for long. It cannot be perpetual. So there are these protective measures, but side-by-side you work on increasing your efficiency, competitiveness," he told reporters here.
Last week, government extended the minimum import price (MIP) on steel products by two months, but pruned the list from 173 products to 66. It said rest of the products will be brought under anti-dumping duty, which is a better protection mechanism.
Singh's predecessor, Narendra Singh Tomar too, in April this year, had a similar advice for the domestic companies.
Tomar, now Union Rural Development Minister, had said: "But in the long term, industry has to accept external realities and learn to compete and emerge stronger in spite of them. Time is of essence and all plans and actions by the companies must be well-planned and executed." Stressing on increasing investments and focus on R&D, the Minister said there are some sectors where steel can be more prominently used, like in constructing highways, bridges, railways, ship yards and also in rural India.
"But Indian industry should also come out with new products and that can happen only with innovation and focus on research and development (R&D). My focus is on these issues," he explained.
The Parliamentary Standing Committee on Coal and Steel in its report placed in Parliament yesterday, pointed out that expenditure by Indian steel companies on R&D remained a dismal 0.05-0.5 percent of their sales, which is lower compared to 1-2 per cent by those in China, Japan and South Korea.
It recommended that Indian steel companies, both public and private, should make an attempt to benchmark their R&D spending with internationally prevalent best practices in the sector.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
