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Date: 21-apr-2025 | By: Nuztrend Team
Photo by yasin hemmati on Unsplash
In a significant move to safeguard its domestic manufacturing sector, the Indian government is preparing to impose a 12% temporary safeguard duty on select steel imports. The decision comes in response to a growing influx of cheaper steel from countries like China, South Korea, and Japan, which has put considerable pressure on Indian steelmakers.
India recorded 9.5 million metric tons of finished steel imports during the fiscal year 2024–25 — the highest in nearly a decade. Of this, nearly 78% came from the three Asian exporting nations. The surge has been blamed for distorting domestic pricing and threatening the viability of local mills, particularly smaller and mid-sized producers.
Following an investigation launched in December 2024, the Directorate General of Trade Remedies (DGTR) recommended the temporary safeguard measure after finding that the surge in imports had a materially adverse effect on the local industry.
Local steel producers — including major players such as JSW Steel, Tata Steel, and the Steel Authority of India — have been lobbying for trade protection. Many smaller mills, facing margin erosion and capacity cuts, are at risk of layoffs and closures without policy intervention.
The Ministry of Finance is expected to make a final decision soon, but sources suggest that the recommendation is likely to be accepted to stabilize the industry.
India now joins other countries considering similar trade actions as global overcapacity, particularly from China, disrupts international markets. The 12% tariff is seen as a strategic tool to buy time for the domestic industry to regroup and recalibrate production without being undercut by foreign suppliers.
Should the safeguard duty be approved, it will likely apply for a limited period and be subject to review. Meanwhile, domestic producers are expected to raise capacity utilization and maintain employment levels — a key concern amid ongoing global economic uncertainty.
Industry analysts believe this move could help restore pricing power to Indian manufacturers and reduce the country’s dependency on foreign supply for critical infrastructure materials.
Source: Reuters
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