India’s Steel Ministry has proposed a 25% safeguard duty on certain steel imports to address growing concerns over cheap imports, particularly from Free Trade Agreement (FTA) countries. This proposal, aimed at strengthening domestic steel production, was discussed during a meeting between Union Steel Minister H.D. Kumaraswamy and Commerce Minister Piyush Goyal in New Delhi. The meeting also involved top executives from leading steelmakers like SAIL, Tata Steel, JSW Steel, and AMNS India.
The rising influx of low-cost steel imports, especially from countries benefiting from FTAs, has raised alarm within the domestic steel industry, which claims that these imports undermine competitiveness and hurt local production. Minister Kumaraswamy highlighted the need for measures to foster self-reliance in India’s steel sector, ensuring both ease of business and global competitiveness. “Strengthening the steel and heavy industries sector is critical for building a self-reliant India,” he said.The proposed safeguard duty would apply to specific steel items and aims to counteract the challenges posed by cheaper imports. The steel ministry has noted that around 62% of steel imports currently come from FTA countries, where goods are exempt from duties, weakening the intended effect of existing trade policies.
India’s steel imports surged to 5.51 million tonnes (MnT) in April-September 2024, compared to 3.66 MnT in the same period the previous year. Imports from China, in particular, saw a significant increase from 1.02 MnT to 1.85 MnT during this timeframe. The growing imports are putting additional strain on the domestic steel industry, which has long called for stricter import regulations. The proposal for a safeguard duty comes amid broader concerns regarding FTAs, which allow foreign firms to partner with Indian companies and re-import steel at concessional rates, intensifying competition for domestic producers. While India has FTAs with countries like Japan, South Korea, Mauritius, and the ASEAN bloc, the trade agreements have become a focal point of debate over their impact on local industries. The Steel Ministry’s focus is on boosting domestic production, enhancing quality, and ensuring that India remains a competitive player on the global manufacturing stage. With an eye on bolstering its self-reliance goals, the ministry is working towards creating an enabling environment for the sector’s growth, with an emphasis on innovation and sustainability.
