Tata Steel obtains blockchain-based steel export order from UAE

Tata Steel obtains blockchain-based steel export order from UAE

Indian multinational steel producing company- Tata Steel Ltd. has reportedly announced that it has received a ‘blockchain-enabled transaction’ from a UAE-headquartered company for a steel export order, making it the first for any steel company across the globe.

In an official press release, Tata Steel and banking giant- HSBC executed the blockchain-based transaction on Contour's blockchain platform. In addition to the above, the live trade finance deal comprised of the export of steel by Tata Steel, India to Universal Tube and Plastic Industries in UAE.  

According to a statement by Peeyush Gupta, Vice President of Steel Marketing and Sales, Tata Steel, the novel initiative carried out along with HSBC showcases the efforts undertaken by the steel giant to lead the technology-based disruptions by reimaging the global trade-set up.  

Elaborating further on the concept behind the blockchain transaction, the steel-making giant claimed that the technology in trade finance allows comprehensive visibility for all those involved in the transaction along with improving and securing payments. Moreover, it also assists in reducing the document negotiations and reducing the transaction period from weeks to few days.  

It is also worth noting that the technology also helps in reducing the duration of transaction of Letter-of-Credit procedures by facilitating electronic transfer of title documents and connecting the different parties allowing instant updates.

Hitendra Dave, Head-Global Banking & Markets, HSBC India, was reportedly quoted stating that the banking giant is focusing on improving the use of blockchain technology across a wider series of trade finance transactions.

Dave further mentioned that the latest transaction with Tata Steel marks an integral step towards mass commercialization and the use of the technology to lay a transformative impact on trade finance.

Seemingly, Tata Steel claimed that UAE has emerged as India’s third-largest trade ally over the years. Additionally, although the physical transfer of goods between India and UAE takes a comparatively shorter time, the documentation may delay its delivery.  

Thus, a reduction in time will help drive the efficiency in India- UAE trade corridor which is mainly characterized by various close-proximity shipping paths.

Source Credit: http://www.businessworld.in/article/Tata-Steel-Receives-Blockchain-Enabled-Transaction-From-UAE-Firm/21-04-2021-387236/