ArcelorMittal Nippon is suing the Indian government over retroactive import restrictions on met coke, a steelmaking raw material. The company argues these curbs threaten its production and result in financial harm. The case highlights broader concerns regarding India’s trade policies, with implications for investor confidence and operational stability among steel producers.
ArcelorMittal Nippon has initiated legal action against the Indian government for retroactively imposing restrictions on the import of low-ash metallurgical coke (met coke), essential for steelmaking. Since January, India has implemented country-specific quotas to protect local suppliers, leading to concerns among major players like ArcelorMittal Nippon regarding the quality of domestic met coke. The joint venture warned that these curbs could force it to drastically reduce steel production and postpone expansions.
The lawsuit, filed in the Delhi High Court on March 5, challenges the rejection of 168,300 tonnes of met coke orders from Indonesia and Poland. ArcelorMittal Nippon argues that the government’s decision contradicts the free trade policy, which allows for imports of orders placed before the implementation of restrictions. The complaint emphasized that applying the policy retroactively introduces uncertainty for traders and investors.
Moreover, the filing asserts that New Delhi has enough met coke available in the domestic market but acknowledges that companies prefer imports due to significantly lower costs, averaging $50-100 less per tonne. Along with threatening operational stability, the curbs could lead to financial losses, estimating that each consignment could incur up to $25 million in costs, plus daily vessel detention fees of $27,004 if permissions are delayed.
The Indian government has not publicly responded, though officials must answer the court by next week. Additionally, larger competitor JSW Steel has also filed a case against the government for delays in meeting prior met coke import requests worth $90 million. India’s steel secretary maintained that an adequate supply of met coke from local sources mitigates the need for imports.
The ongoing legal conflict between ArcelorMittal Nippon and the Indian government highlights significant concerns regarding the retroactive application of import restrictions on met coke. As this matter develops in the Delhi High Court, it raises critical questions regarding trade policies and operational impacts on major steel producers in India. The outcome will likely influence not only ArcelorMittal’s future production capabilities but also broader investor confidence in India’s trade regulations.
Original Source: money.usnews.com
