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Steel industry mulls approaching WTO

Sandip Das

The domestic steel industry is planning to ask the government to appeal to the World Trade Organisation appellate body against the United States International Trade Commission's findings of 'injury' to the US steel industry from imports of hot-rolled steel from several countries including India, China, Indonesia and Ukraine.

"We are planning to challenge the ITC injury determination in the WTO," an Indian Steel Alliance-Confederation of Indian Industry official said.

ISA, comprising all the major Indian steel companies, is expected to meet over the next couple of days to chalk out the future course of action and take up the issue with the Indian government, the official said.

The USITC, in its final report released recently, had said: "An industry in the United States is materially injured by reason of imports from India, Indonesia, China and Thailand of hot rolled steel products and it has been found by the department of commerce to have been sold at less than fair value."

Steel industry sources said that the USITC decision was based on its identical 'injury determination' on hot-rolled steel imports from Argentina, South Africa and Japan in August, 2001, which was later rejected by WTO.

The WTO appellate body, while considering the case, held that the USITC determination was inconsistent with the WTO anti-dumping agreement because it 'does not entitle investigating authorities to conduct a selective examination of one part of a domestic industry'.

The appellate body also stated that USITC failed to discuss factors other than dumped imports that may have caused injury to the domestic industry. USITC will be presenting its 'injury decision' and remedy recommendations to US President George Bush by December 19.

Bush will be required to decide on the final plan within 60 days.

Section 201 of the Trade Law empowers Bush to impose a quota, hike tariff or come up with a combination of both known as a tariff-rate quota to restrict steel exporters from India and elsewhere.

The US imports around 34 million tonne of steel from different countries including Brazil, Ukraine, China and India.

India exports around 0.9 million tonne of steel to the US.

President Bush launched the Section 201 investigation in June this year following an intensive campaign by steel workers who have lost their jobs because of a slowdown in the sector.

However, industry sources said that the US steel importers have criticised the ruling by saying it would do nothing to solve the problems facing the domestic steel industry and could even lead to a trade war.

They have also warned that import restrictions could severely damage the already fragile global economy by triggering a new round of protectionism around the world.

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