India has initiated an anti-dumping investigation into steel import from Vietnam following an application filed by Indian Steel Association (ISA) on behalf of two largest domestic producers, JSW Steel and AMNS India.

The investigation launched by the Directorate-General of Trade Remedies under the Union ministry of commerce will investigate export of hot rolled flat products (not coated, plated or clad) of a thickness up to 25 mm and width up to 2,100 mm from Vietnam to India from January 1, 2023 to March 31, 2024. The applicants have claimed for retrospective imposition of anti-dumping duty.

Even as ISA had filed the application before DGTR in April, the gazette notification from the ministry came on Wednesday. The probe kicks off at a time HRC price (ex-Mumbai) has fallen to ₹50,300 a tonne, a level last seen during the Covid-19 outbreak, according to data shared by research outfit BigMint.

Indian steelmakers had been warning about a surge in exports, especially from China and countries that enjoy duty free access to the domestic market, driving down the price. The notification dated August 14 notes that ‘the landed price of the subject imports had the depressing effect on the prices of domestic industry.’

“The petitioners have claimed that because of the adverse volume and price effect of the dumped imports, its performance has deteriorated in respect of cash profit, market share, profit and return on investment. The petitioners have also claimed that there is also a threat of injury to the domestic industry due to the dumped imports,” the DGTR notification read.

The Authority believes that, “there is sufficient prima facie evidence that the domestic industry has suffered material injury and there is a threat of injury due to dumped imports from the subject country to justify the initiation of the anti-dumping investigation.”

Domestic steel industry, which is pouring billions of dollars in capacity expansion, has been alleging trade diversion from China to India via Vietnam, which enjoys duty free access to India under Indo-Asean free trade agreement. In contrast, export of similar items from non-FTA countries, such as China, attract 7.5 per cent duty.

India imported 3.55 million tonne of HRC plates in FY24, out of which imports from Vietnam stood at 0.62 mt, trebling from FY23, BigMint data showed.

In June, rating agency Crisil had observed that India became a net importer of steel in FY24, with an overall steel trade deficit of 1.1 mt, marking a shift in status as a net exporter since FY17.

Domestic producers have warned that rising imports at a predatory price can crimp margins, which may dry up cash flow required for expansion.