Non-tariff barriers (NTBs) block Bangladesh's export of MS (mild steel) rod to India's northeastern states, which local manufacturers say is their captive market.
The barriers include mandatory standard certification from the Bureau of Indian Standards (BIS) and levy to be given to BIS on production.
“We have been trying for the last several years to export rod to India, but can't do it because of the NTBs,” said Aameir Alihussain, director of Bangladesh Steel Re-Rolling Mills (BSRM), one of the big players.
He said Bangladesh needs some preferential facilities from the neighbour as the country has agreed to allow its ports and transit for Indian use.
The steel manufacturers said the NTBs are encouraging smuggling to the northeastern states as price of rod is higher in India.
The price of 40-grade rod was between Tk 43,500 and Tk 47,200 per tonne as of yesterday, while it was Tk 47,000-Tk 48,200 for the 60-grade, said Trading Corporation of Bangladesh.
Market players said a tonne of 40-grade rod is being sold in India at equivalent to Bangladesh's Tk 60,000.
There are more than 100 steel and 350 re-rolling mills in the country and their total production capacity is around three million tonnes a year against the consumption of maximum 2.5 million tonnes.
Abul Khair Group has recently entered steel manufacturing venture with a daily production capacity of 3,000 tonnes.
Following Prime Minister Sheikh Hasina's recent visit to India, businessmen from all corners want the country to address the NTBs it imposed in various formats -- from state tax to standard certification.
Alihussain said three Indian rupees should be given to the BIS for production of every tonne of rod in case of export. “It can't be, it should be on the value of the exports,” he said.
Fazlur Rahman Bakul, president of Bangladesh Steel Mills Owners' Association, said they could not utilise the export potential in the northeastern states because of the standards and certification issues.
“We can also export to Myanmar and Nepal,” said Bakul.
Steel makers also said a huge quantity of rod is being smuggled to India's northeastern states through Bangladesh's Sylhet region.
“Some 30 percent of Bangladesh's rod are being smuggled to India, particularly to northeastern states,” said Masudul Haque Masud, former general secretary of the association.
Around 30,000 tonnes of rod were shipped to Sylhet two months ago, which he believed were for India's consumption.
Sirajul Islam Mirdha, managing director of Bikrampur Re-Rolling Mills, said he has also heard of rod smuggling to India.
Source: thedailystar.net
