New budget to boost steel demand in India

The new budget will provide steady support for Indian steelmakers in fiscal year 2023 (April 2022-March 2023). The government continues to focus on building infrastructure to facilitate the smooth movement of people and the transport of goods. Authorities have also removed import duties on scrap steel and certain metal products to support local small and medium enterprises. Capital expenditure in fiscal 2023 will reach INR 7.5 trillion ($100.24 billion).

That's 35 percent higher than this year's budget, according to an official document. The government continues to focus on consumer industries such as railways, highways and urban infrastructures in order to create an efficient supply chain ecosystem across the country. Projects such as affordable housing, hospitals, irrigation systems and plumbing will also support local steel producers.

Nirmala Sitharaman, Minister of Finance of India, said: "The central government will work with the state governments to shorten the time for land approvals and build affordable housing for the middle class and economically disadvantaged people in urban areas. India Measures will also be taken to reduce urban pollution. Authorities will encourage residents to use public transport more often and switch to electric vehicles by creating special areas where fossil fuels cannot be used. Expanding infrastructure for electric vehicles is also a spending item.

Indian authorities have extended for a year a decision to exempt steel scrap imports and anti-dumping duties on certain steel products, including coated flat products, alloy steel and high-speed steel-made bar and wire. The import duty on semi-finished products, flat products and long products remains at 7.5%. The authorities lowered it from 10-12.5% in the previous financial year to support local SMEs.

"Our experience shows that acceptable tariff levels help develop local industries and support 'Make in India' initiatives without having a significant impact on the cost of imported goods," said India's finance minister.