The shares of Steel Companies JSW Steel, Tata Steel and Steel Authority of India (SAIL) saw a tremendous rise on March 19. The reason for this edge is the recommendation of the Directorate General of Trade Remedies (DGTR), which proposes to impose a 12% temporary safeguard duty on flat steel products.

After this decision, SAIL shares climbed up to 4%, while Tata Steel and JSW Steel shares also strengthened.

What is safeguard duty?

Safeguard duty is a temporary tariff barrier, which is deployed to protect the domestic industry from a sudden increase in imports.
DGTR has recommended a 12% temporary safeguard duty on flat steel products for 200 days.
This duty will remain in force until the final investigation is completed.

The steel industry had been demanding 25% safeguard duty for a long time, but the government proposed 12% duty.

Which products will this duty be charged?

DGTR recommends imposing this duty on non-all and alloy flat steel products:

Hot rolled coils, sheets and plates
Cold rolled coils and sheets
Metallic coated steel coils and sheets
Color coated coils and sheets
Galvaninil coated products (zinc, aluminum-gink, zinc-aluminum-magnesium)

Which products will not be charged?

Stainless steel
Cold-rated grain-oriented electrical steel
Aluminum-koted steel

Why is Safeguard duty being imposed?

To protect domestic steel industry
Steel imports in India have recently increased rapidly, causing damage to domestic steel companies.
If the steps are not taken on time, it will be difficult for the Indian steel industry to recover.

However, the government will also have to ensure that the downstream industry and consumers do not get expensive steel.

This decision has an impact on the market

SAIL shares climbed up to 4%
Tata Steel and JSW Steel shares also opened on green mark
Possibility of further strength in the steel sector