India: Steel ministry proposes 25% safeguard duty on imports

• Steel, commerce ministries meet with leading companies
  
  
• Proposal comes amid rising imports from FTA countries
  
  

The Indian steel industry is facing increasing pressure from rising steel imports, particularly from countries with favourable free trade agreements (FTAs). To address this issue, the Ministry of Steel has proposed a 25% safeguard duty on certain steel items. This proposal comes in response to concerns raised by domestic steel companies about rising cheap imports.

Joint effort to boost domestic steel industry

On Monday, 2 December 2024, the Union Minister of Steel, H.D. Kumaraswamy, and the Commerce and Industry Minister, Piyush Goyal, met to discuss strategies to strengthen the domestic steel industry. The meeting was attended by senior officials from both ministries and executives from leading steel companies, including SAIL, Tata Steel, JSW Steel, and AM/NS India.

Key concerns

Domestic steel producers have expressed concerns over rising imports of cheaper steel, which is impacting their competitiveness.

India's steel imports were at 5.38 million tonnes (mnt) in April-October FY'25, significantly higher than 3.54 mnt in the year-ago period. Moreover, imports from China surged to 1.61 mnt during the same period from 0.74 mnt in April-October FY'24.

While the government has acknowledged the challenges faced by the industry, it has also recognised the potential impact of such a move on steel-consuming industries. The government is working to balance the interests of both producers and consumers.

Impact of FTAs, port delays

The rise in steel imports, particularly from FTA countries, has been a major concern for the domestic industry. These imports often benefit from preferential tariffs, making them more competitive. Additionally, port delays and regulatory hurdles are adding to the challenges faced by the industry.

Government's stance

The government is committed to fostering a conducive environment for the growth of the domestic steel industry. It is taking steps to address the issues related to steel imports, including exploring options such as safeguard duties and stricter regulations. However, the government is also mindful of the potential impact on downstream industries and is working to balance the interests of all stakeholders.