ArcelorMittal’s India sales hit by import policies as weak demand
Billionaire Mr Lakshmi Mittal led ArcelorMittal, the world’s largest steel producer, has seen a steady decline in its businesses in India as weak demand and import policies have hit sales, while investments in local firms and manufacturing plans have disappointed.
According to the firm’s 2014 annual report, ArcelorMittal and its subsidiaries reported sales of USD 225 million from India, down 74% from the USD 873 million reported in 2010.
To be sure, domestic steel firms have struggled with weak demand due to a slowdown in the investment cycle over the last couple of years and rising imports from markets such as China, Japan and South Korea. ArcelorMittal is no exception.
An ArcelorMittal spokesperson said that “In addition to this (weak demand), the rupee has depreciated more than 30% since 2010, which made imports more difficult. Further, that we have to pay more import duty that is 7.5% as against import from Free Trade Agreement (FTA) countries, who pay just 0.8%, has made competition much tougher in Indian market. Adding that realizations in India have been lower compared to other markets. The firm does not disclose margins across its India business.”
Source : Livemint