PULSE POINTS:

What Happened: India plans to implement a 12 percent safeguard duty on steel imports to curb an influx of inexpensive steel from foreign nations, especially China.

Who’s Involved: The Indian government, Directorate General of Trade Remedies (DGTR), Ministry of Finance. Key stakeholders include JSW Steel, Tata Steel, the Steel Authority of India, and ArcelorMittal Nippon Steel India.

Where & When: The measures will apply in India, with the duty expected to be enforced promptly following final government approval.

Key Quote: “There is clarity that the duty would be 12 percent and a decision is expected at the earliest,” a source informed of the situation stated.

Impact: The surge of cheaper steel imports has led to operational challenges and potential job cuts among India’s smaller steel mills.

IN FULL:

India is set to impose a temporary tariff of 12 percent on steel imports, aiming to counter a significant increase in low-cost steel products from China. The action, referred to locally as a safeguard duty, is intended to take effect promptly.

As the second-largest producer of crude steel, India was also a net importer of finished steel for the second straight year during the 2024/25 fiscal year. Preliminary government data shows that steel imports climbed to their highest level in nine years, reaching 9.5 million metric tons.

The Directorate General of Trade Remedies (DGTR) advised last month that a 12 percent tariff be placed on certain steel imports for 200 days. This recommendation forms part of broader efforts to manage cheap imports, following an investigation that began in December of the preceding year to evaluate the impact on Indian steel manufacturers. Of primary concern is China’s dumping of cheap steel products on Indian markets, which aims to undermine India’s domestic steel industry.

“There is clarity that the duty would be 12 [percent] and a decision is expected at the earliest,” an Indian government source said, regarding the anticipated adoption of the DGTR recommendation.

In recent months, India has recorded a surge in finished steel imports from China, South Korea, and Japan. These three countries were responsible for a large portion, amounting to 78 percent of India’s finished steel imports.

This influx is putting financial pressure on smaller steel mills in India, leading some to downscale operations or even contemplate layoffs. A number of nations are considering similar measures to restrict imports, as India’s main steel industry associations, including JSW Steel, Tata Steel, the Steel Authority of India, and ArcelorMittal Nippon Steel India, continue to express concerns about the market effects of such imports.

Image by GovernmentZA.

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