India considers increasing tariffs on steel to support the rupee exchange rate

Foreign media quoted government documents and people familiarwith the matter on Wednesday saying that the Indian Ministry of Steel hasproposed to increase the effective import tax rate for some steel products fromthe current 5-12.5% to 15%.

A source said the proposal is part of a broader plan by theIndian government to cut "unnecessary" imports to stop the dollar'soutflow. The outflow of the dollar caused the rupee exchange rate to fall to arecord low. The Indian Ministry of Commerce will discuss this proposal onWednesday.

According to official data, in the second quarter of thisyear, India became the net importer of steel for the first time in two years.The import volume of foreign steel products reached 2.1 million tons, anincrease of 15% over the same period last year.

In 2017, India imported more than 7 million tons of steelfrom countries such as South Korea, Japan and China.