Govt's online system to monitor steel imports amid criticism from industry

The government on Monday launched an online system to monitor steel imports, despite criticism from the industry.

The Steel Import Monitoring System (SIMS) will provide advance information about steel imports to both the government and stake holders.

Stakeholders include the steel industry (producers) and consumers (importers). 

Based on these, they can carry out effective policy interventions, the commerce department said on Monday.

Under this system, the importers of specified steel products will have to register in advance on the web portal of SIMS, providing necessary information. 

The move has been slammed by user industries. The Engineering Export Promotion Council (EEPC) termed the move as restrictions on steel product imports at a time when exports are battling a global slowdown.

In a letter to Commerce and Industry Minister Piyush Goyal, EEPC chairman Ravi Sehgal said while compulsory registration will monitor steel product inflow into the country, the specifications seem unwarranted. 

The EEPC has particularly been against levying a registration fee, which it has called unnecessary. 

Steel products are imported in bulk quantities with a minimum lot size of 50-100 tonne. The registration fee to be levied will be a certain percentage of the imported quantity.

A Directorate General of Foreign Trade notification of September 5 mandated compulsory registration for import of most steel products — under Chapter 72 and few products under Chapter 73 and 86 of the Indian Trade Clarification based on the Harmonized System of Coding.

Based on the pattern of the United States’ Steel Import Monitoring and Analysis system, the government's monitoring platform will allow an importer to apply for registration between the 60th day and the 15th day before the expected date of arrival of the consignment. 

Subsequently, the automatic registration number thus granted will remain valid for a period of 75 days. Importers will have to enter the registration number and expiry date of registration in the bill of entry to enable customs to get the consignment cleared. After being one of the growth drivers in the previous fiscal year, engineering goods exports have performed poorly in FY20, falling by 9.35 per cent in August. 

Accounting for nearly 25 per cent of the foreign exchange earned, the pace of contraction had been 1.69 per cent in July. The European Union has further slashed the quota on steel products shipped from India. Also, the imposition of Section 232 and withdrawal of the Generalized System of Preferences by the US restricted exports to the major market.

The government also announced a common digital platform for issuing electronic Certificates of Origin, a document declaring in which country a commodity or good was manufactured. 

To be a single access point for exporters, current trade deals and agencies concerned, authorities of Foreign Trade Agreement partner countries will be able to verify the authenticity of certificates from the website. 

This is expected to significantly reduce transaction cost and time for exporters.

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