Steel ministry moves SLP in SC to keep its BIS mandate even on intermediate steel products

Mint

6 days ago

New Delhi: The Union steel ministry has moved the Supreme Court against a high court stay order on import curbs on steel that fall short of national standards, highlighting the plight of small businesses amid government's thrust for local manufacturing.
The ministry's special leave petition (SPL) follows a 13 June notification mandating Bureau of Indian Standards (BIS) certification for all imported raw material that goes into making steel products.
The notification led to protests by micro, small and medium enterprises (MSMEs) that import cheap raw materials for making steel products, prompting the government to suspend the order until 15 July. In the meanwhile, a petition against the notification by an MSME producer led the Madras High Court to order a stay on it on 13 July.
MSMEs include secondary steel makers who depend largely on steel imports used as inputs in their final steel products, potentially pitting them against the government, whose rationale for imposing a quality control order was to check steel dumping into the country.
The steel ministry, in its SLP filed on 23 July seen by Mint, has requested the apex court to stay the interim order of Madras High Court.
'It is respectfully submitted that the said order was passed at the admission stage without even hearing the stand of the Union of India," the ministry's petition says.
The steel ministry's 13-June notification mandated that in addition to finished steel products, intermediate raw materials such as stainless steel slabs, and hot rolled and cold rolled coils must be BIS-certified for all imports with a bill of lading dated on or before 16 June.
On 11 July, the ministry exempted the mandatory adherence of BIS specifications for raw materials used in final steel product in case of imports, where material have been shipped on or before 15-07-2025.
MSME importers then wrote to the steel ministry asking for the notification to be withdrawn. The QCO, which was notified on 13 June but whose implementation was ordered just three days later, put approximately ₹150 crore of advance payments in jeopardy, according to a letter written by industry body Federation of Associations of Maharashtra (FAM) on 18 June to the steel ministry.
"Importers who placed orders months ago under pre-existing regulations are now facing uncertainty. Shipments already in transit or contracted prior to 16 June are suddenly non-compliant, risking needless financial loss and supply disruption," said the letter.
Subsequently, a writ petition was filed in the Madras High Court by Shree Ramdev Metalex LLP challenging the steel ministry's 13 June notification as being bad in law and contrary to BIS Act, 2016 and the BIS Rules, 2018.
'The domestic steel industry faces QCO and similar regulations should not be there for imports. It's no point to have BIS specifications for hot rolled coils but not for say slabs. Government should address the concerns of certain sections of the industry with respect of BIS specifications separately," said A.S. Firoz, former chief economist at the Economic Research Unit of the ministry of steel.
In June 2025, 0.797 million tonnes (mt) of finished steel were slated for imports under 25,759 such applications, as per the SIMS portal monthly report by the union steel ministry. SIMS stands for Steel Import Monitoring system.
Korea, with a share of 34.6%, followed by China, with a 30.6% share of May 2025 imports, were the top two sources.
The highest share of the imports in June 2025—29.1%—were for the automobile and auto components sector, SIMS data showed.
Chandan Bhansali, president of the Metal & Stainless Steel Merchant's Association (Massma), said the steel ministry's strategy on imports was becoming a hindrance to micro and small businesses.
"The micro and small-scale industries are already suffering from slowing down of economy and these compliances are implemented with an impossible timeline of one working day. The SIMS 2.0 portal in its new avatar is too regressive and implementation has become exactly opposite of 'ease of doing business'."
'Compliance of BIS standards for intermediate product is required to ensure that the finished product is as per quality requirement given by BIS Standards. If this not done, a final product may be sub-standard. It is also to be noted that because of excess capacity and declining consumption in certain countries, there a is big possibility of dumping of substandard steel. As India is the only fast-growing large economy in the world, there is a very high possibility of cheap steel getting pushed into Indian market unless adequate measures are put in place for import of quality steel," a steel ministry spokesperson said in reply to a query mailed by Mint on 27 July. The query was mailed to the spokesperson as well as secretary in the ministry of steel.
The ministry did not respond to questions on the legal action taken by it.