India's Ministry of Finance announced in a notification the imposition of safeguard duties on certain imported steel products for a period of three years. The duty rate will be 12% in the first year, gradually decreasing to 11% over the subsequent two years.
"Tariff Hikes" on Specific Imported Steel
It is noteworthy that India had already taken protective measures for its steel industry in April 2025, initially implementing a 12% provisional safeguard duty for 200 days.
This wasn't India's earliest action in this area either.
As early as December 2024, India's Directorate General of Trade Remedies (DGTR) had initiated an investigation, directly pointing to a surge in imports of flat steel products made from non-alloy and alloy steel. These steel products are widely used in various industries, including manufacturing, pipelines, construction, automobiles, tractors, bicycles, and electrical panels.
Investigation data showed that India's imports of such steel products skyrocketed from 2.293 million tonnes in the fiscal year 2021-22 to 6.612 million tonnes during the investigation period—a nearly threefold increase. The primary sources of these imports were countries like China, Japan, South Korea, and Vietnam.
Faced with this overwhelming surge in imports, India's domestic steel giants became concerned. The Indian Steel Association, representing several major steel enterprises, petitioned the government, ultimately leading to the introduction of this three-year tariff.
Since surpassing Japan in 2018 to become the world's second-largest crude steel producer, India has maintained this position for six consecutive years.
According to data from the World Steel Association, India's crude steel production reached 141 million tonnes in 2023, accounting for 7% of global output. By 2025, India's steel production capacity is expected to reach a staggering 205 million tonnes, with a target of exceeding 300 million tonnes by 2030.
However, India's latest tariff policy includes a crucial detail—a price exemption mechanism. Specifically, if the import price of hot-rolled coils falls below $675 per tonne, or cold-rolled coils below $824 per tonne, the safeguard duties will not apply.
This design aims to protect the domestic industry while ensuring downstream users have access to reasonably priced imported steel.
It's important to note that domestic hot-rolled coil prices in India have gradually declined from a peak of 52,850 Indian Rupees per tonne in April 2025 to 46,000 Indian Rupees per tonne by November.
More notably, current domestic hot-rolled coil prices in India are now below import parity prices, reflecting ongoing supply-side pressures.
Market data indicates that in May 2025, India's finished steel imports decreased significantly by 40.7% year-on-year to approximately 428,000 tonnes. This marked the second consecutive month of decline in imports. Furthermore, during the first half of the 2025-26 fiscal year, India's steel imports totalled 3.3 million tonnes, a 30% decrease year-on-year.
Despite this decline, India remains a net importer of steel. The implementation of this protective tariff policy acts like a double-edged sword. While steel companies celebrate, downstream steel-consuming industries face difficulties. For instance, sectors like automobile manufacturing, engineering machinery, and construction worry that the tariffs will push up raw material costs, thereby weakening their export competitiveness.
In fact, this is not India's first restrictive measure on Chinese steel products. As early as September 2025, India's Ministry of Commerce and Industry issued a final anti-dumping ruling on Cold Rolled Grain Oriented Steel Sheets originating in China. It recommended imposing anti-dumping duties on the Chinese products for five years, with specific duty amounts set at:
l $223.82 per tonne for Baosteel Zhanjiang, Baoshan Iron & Steel, and Wuhan Iron and Steel;
l $414.92 per tonne for other Chinese producers.
However, under the current policy, if Chinese hot-rolled coil prices fall below $435 per tonne, the protective effect of the safeguard duties will be significantly weakened.
It could be said that India's three-year tariff provides a window of adjustment for domestic steel companies, but it is also merely a temporary respite.
