While many businesses have been hit during the pandemic, India’s steel exports have reportedly more than doubled between April and July and hit their highest level in at least six years. This is because of a surge of Chinese buying.
Trade tensions between the two countries have been high since the Galwan valley face-off between the army of the two nations. While India is running a ‘self reliance’ or atma nirbhar Bharat campaign, it looks like Chinese buyers are importing steel from India in defiance of the tensions Beijing and New Delhi. Traders said reduced prices had led them to the purchase as Indian sellers sought to get rid of a surplus generated by the impact of COVID-19 on domestic demand and generate much-needed income.
Its not clear whether the sales broke any rules but the China Iron and Steel Association is reportedly monitoring them. Steel companies Tata Steel Ltd and JSW Steel Ltd were among Indian companies that sold a total of 4.64 million tonnes of finished and semi-finished steel products on the world market between April and July. In comparison, 1.93 million tonnes was shipped in the same period a year earlier. Vietnam and China bought 1.37 and 1.3 million tonnes of steel of the 4.64 million tonnes. These Chinese purchases are the largest since data was first collated in the current form beginning with the fiscal year April 2015-March 2016, the report states. Even though China, the world’s leading steelmaker produces vast quantities, its still importing as it has ramped up infrastructure spending.
During the first four months of the 2020-21 fiscal year, China and Vietnam together bought close to 80% of India’s total hot-rolled coils exports, the data showed, while the product constituted more than 70% of India’s steel exports.