On Tuesday, the rupee skidded by 46 paise to settle at 72.97 against US dollar.India's steel ministry has proposed increasing the effective import duty on some steel products to 15 percent from current rates ranging from 5 percent to 12.5 percent, according to two sources and a government document reviewed by Reuters, as the country looks to support the rupee.The proposal, which is part of a broader government plan to cut "non-necessary" imports to stop an outflow of dollars that has sent the rupee to record lows, will be discussed in the trade ministry on Wednesday, according to one of the sources involved in the matter."The broader message is to address the trade balance but we will try to promote 'Make in India' by encouraging domestic (steel) production," said the source, who declined to be named ahead of a possible decision.The source said there was no certainty that the proposed duty would be imposed.The steel and trade ministries did not immediately respond to requests seeking comment.In the three months to end-June, India became a net steel importer for the first time in two years, with foreign supplies reaching 2.1 million tonnes, up 15 percent from a year earlier, according to official data.In the 2017/18 financial year to end-March, the country imported 8.4 million tonnes of steel, 45 percent of which came from Japan and South Korea with which India has free trade agreements.The proposed duties may not apply to imports from the North Asian countries, but other steel suppliers such as China, South Africa, Malaysia, Russia and Indonesia could be affected.Apart from steel, India is considering raising import duties on some farm commodities, potentially for a few months, although it is wary of the risks of retaliation, said a senior government official with knowledge of inter-ministerial deliberations on proposed restrictions.The government is also looking at curbs on imports of gold and high-end electronic items, a trade ministry source said last week.India is the world's second biggest gold buyer, and its imports in August rose more than 90 percent to $3.64 billion.
Thomson Reuters 2018(Except for the headline, this story has not been edited by TheIndianSubcontinent staff and is published from a syndicated feed.)