India’s Ministry of Finance has introduced a temporary 12% safeguard duty on specific steel imports to address the surge of low-cost steel entering the market. The measure, effective for 200 days starting Monday, may be revised, extended, or revoked as needed. The decision follows an investigation initiated in December to evaluate the impact of rising steel imports on domestic producers.

The tariffs are primarily directed at China, the second-largest exporter of steel to India after South Korea in FY24/25.

The tariff primarily targets imports from major steel-exporting countries, with China being the second-largest supplier to India in the fiscal year 2024/25, after South Korea. The policy aims to support local steel manufacturers facing competitive pressures from imported steel.

Steel Minister H. D. Kumaraswamy stated: “This move will provide critical relief to domestic producers, especially small and medium-scale enterprises, who have faced immense pressure from rising imports. The safeguard duty will help restore market stability and reinforce the confidence of the domestic industry.” The minister highlighted the importance of ensuring a level playing field for Indian steelmakers.

A senior executive from a major Indian steel company remarked: “The decision is along expected lines and we will now wait and see how this measure supports industry and margins and restricts cheap imports into the country.” The statement reflects cautious optimism about the tariff’s potential to bolster the domestic steel sector.

India has been a net importer of finished steel for two consecutive years, with imports reaching a nine-year high of 9.5 million tonnes in 2024/25, according to provisional government data. Leading steelmakers, including JSW Steel, Tata Steel, Steel Authority of India, and ArcelorMittal Nippon Steel India, have raised concerns about the adverse effects of import surges and have called for measures to protect the local industry.

The safeguard duty represents a significant step in India’s trade policy, aligning with efforts to strengthen domestic manufacturing. The move comes shortly after the United States announced a 10% tariff on steel imports from all countries, effective April 5, 2025. India’s temporary measure is designed to stabilize the market while supporting the growth of its steel industry.

The policy has sparked discussions among industry stakeholders, who view it as a necessary step to safeguard local producers. By addressing the challenges posed by high import volumes, India aims to foster a more sustainable and competitive steel sector.