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Tuesday night, February 11, India's steel minister Kumaraswamy said in an interview, India may be in the next six months on steel from China to impose temporary tariffs of 15-25% to deal with cheap imports of domestic steel producers poses a 'serious challenge'.
The Indian government launched a survey in December last year to assess the need for a 'safeguard duty' to curb steel imports, and if implemented, the measure could last up to two years. According to Kumaraswamy, 'Based on the ongoing survey, the government is considering imposing a safeguard duty of 15-25% to prevent unfair competition and ensure a level market environment.'
India has become a net importer of finished steel in the fiscal year ending March 2024, while steel imports from China during April-December 2024 reached record levels. Despite India's rapid economic growth and increased infrastructure investment, domestic steel prices have continued to decline, and some small steel mills have been forced to scale down operations and even consider layoffs due to the surge in imports. Industry insiders point out that former US President Donald Trump's recent sharp increase in steel import tariffs could intensify import pressures in the Indian market, as steel exporters from other countries may turn their targets to India.
JSW Steel, India's largest steel producer, reported earnings for October-December last year that showed a drop in profits that exceeded market expectations. Kumaraswamy said, 'Despite short-term challenges affecting steel exports, the government is actively expanding market access.'
India is looking to expand steel exports to Africa, the Middle East, and Southeast Asia, as well as promote the transformation of domestic steel companies to high-value-added and specialized steel to reduce competitive pressure from China.
India's policy of imposing temporary tariffs of 15-25% on Chinese steel imports reflects the challenges faced by India's domestic steel industry and its response to external competition.
Below is Promisteel's analysis and the impact of this policy
- Challenges for the Indian steel industry:
- India has become a net importer of finished steel products, domestic steel prices have continued to decline, and some small steel mills have faced an onslaught of imported steel, leading to curtailment of operations and even layoffs.
- The Indian government implemented tariffs to curb cheap imports, protect the domestic industry, and ensure fairness in the market.
- The background of the implementation of the policy:
- India launched a survey in December last year to assess the need for a 'safeguard duty', and plans to keep it in place for up to two years.
- India seeks to expand steel exports to Africa, the Middle East, and Southeast Asia, and promote the transformation of domestic steel enterprises to improve value added.
- International Implications:
- Chinese steel companies may face increased competition in the Indian market, affecting exports and profits.
- U.S. scrap exports are declining, and India may turn to Chinese steel products, affecting global steel supply and prices.
