Various sectors have been severely hit by the pandemic but India’s steel sector has seen double the profit as it reaches its highest level in the last six years. The data has been curated from April to July, which is the period when the country was in complete lockdown.
While the government is trying to curb its dependence on Chinese investors or the Chinese market, China has become one of the largest buyers for steel in India. Experts have suggested that this is because of the reduced price that has been quoted by the sellers to get rid of the surplus which is generated by the Coronavirus. Though they are still not certain if any trade rules are broken in the process as the Indian government tries to keep itself restricted towards Beijing, they assured that the deal has been documented.
Two of the biggest companies in India, TATA steel and JSW steel have sold 4.64 million of unfinished and finished steel which, when compared to last year’s 1.93 million, has been very profitable for the steel giants. Vietnam and China were the ones to have scored the shipment. While Vietnam got 1.37, China purchased 1.3 million tonnes of steel. This interest of China in Indian steel has been a surprise for New Delhi as China itself is the largest producer of steel in the world and with this purchase, it managed to churn out the traditional buyers of steel from India–Italy and Belgium. Having said that, China buying such quantities of steel might be due to the country making an effort to revamp its infrastructure.
This has made the circumstances awkward after the relations between both the countries were strained due to border tensions when 20 Indian soldiers were killed in the attack by their Chinese counterparts. This incident resulted in the government tightening the rules on Chinese investment and initiating measures for restricted Chinese movement in India.
Inside industry sources have revealed that the steel manufacturers had reduced the price from $500 a tonne to $430-450 a tonne to lure the buyers. China has shown special interest in hot-rolled coils that are used in pipes, automobile parts, engineering, and military equipment.
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