Seamless tube makers urge govt not to remove restrictions on Chinese imports

New Delhi, Jan 15 (PTI) The Indian steel tube and pipe manufacturing industry has urged the government not to remove existing restrictions on participation of Chinese firms and import of Chinese equipment in power sector projects, as it would hurt the domestic industry.

In a recent letter to the steel ministry, the Seamless Tube Manufacturers' Association of India (STMAI) said the proposed easing of existing restrictions on participation of Chinese firms will jeopardise domestic manufacturing, create banking stress and cause mass unemployment.

The steel tube and pipe industry is a critical backbone of thermal power projects, supplying boiler tubes, high-pressure, high-temperature seamless tubes, and alloy and carbon-steel pipes for balance-of-plant systems.

"We wish to submit this representation with a deep sense of concern and urgency regarding the recent... reports indicating that the government is considering easing existing restrictions on participation of Chinese firms and import of Chinese equipment in power sector projects," the letter said.

It said that if Chinese components and systems are allowed, Chinese suppliers will dump underpriced tubes and pipes, leaving domestic manufacturers with under utilised capacity, leading to the shutdown of advanced facilities.

"Such a policy reversal will directly result in the inability of manufacturers to service term loans taken for capacity expansion, a sharp increase in non-performing assets (NPAs) in PSU and private banks, stress on MSMEs and... suppliers linked to the steel tube ecosystem," it said.

The steel tube and pipe sector, it said, is highly employment-intensive, supporting skilled engineers and metallurgists, among others, and permitting Chinese imports will result in large-scale job losses and the closure of domestic units, the letter said.

"We strongly urge the government to reconsider this proposal and continue to uphold the spirit and substance of Make in India and DPIIT policies, which have enabled India to build credible domestic capabilities in the power sector supply chain," the letter said. PTI SID DRR