India plans up to 15% safeguard duty on steel imports amid rising Chinese influx

Amid the ongoing trade war with the US, which has been ramping up and announcing tariffs against China, Canada, and Mexico, India’s Directorate General of Trade Remedies (DGTR) has recommended imposing up to 15% safeguard duty on select steel imports to counter a surge in shipments, particularly from China, that have turned the country into a net importer over the past 12-18 months.

The DGTR is the trade remedy body under the Ministry of Commerce and Industry,. It is responsible for investigating and recommending measures like anti-dumping duties, countervailing duties, and safeguard duties to protect domestic industries from unfair trade practices or sudden surges in imports.

A safeguard duty is a temporary tariff imposed to shield domestic industries from a sudden increase in imports, regardless of whether unfair trade practices are involved.

“The investigation is almost complete, and its findings are expected to be published within the week. The Commerce Ministry will take a final call on implementing the safeguard duty,” said the first person.

According to people familiar with the matter, the duty will not be applicable beyond certain price thresholds.

For instance, hot-rolled coils priced at or above $650–675 per tonne, hot-rolled plates around $700 per tonne, coated steel at about $860–865 per tonne, and colour-coated steel at about $964 per tonne will not attract the additional levy, said one of the two people mentioned above.

Significant move

This holds significance as the Steel Ministry had initially pushed for a higher safeguard duty of 20-25%, citing the need to curb rising imports, particularly from countries with which India has free trade agreements (FTAs), such as Japan, South Korea, and China.

Queries emailed to the Commerce Ministry were not answered immediately.

The DGTR investigation, launched in December following a complaint from the Indian Steel Association, covers imports of non-alloy and alloy steel flat products used in key industries such as construction, automobiles, capital goods, and electrical panels.

India remained a net importer of steel, with inbound shipments rising over 20% to 8.29 million tonnes during the April-January period of this fiscal, according to Commerce Ministry data. The country had imported 6.89 million tonnes of steel during the same 10-month period in the 2023-24 financial year.

In contrast, exports shrank by 28.9% to 3.994 million tonnes during the period, compared to 5.619 million tonnes in the April-January period of the preceding fiscal year.