India explores US steel imports to counter Trump tariffs, eyes safeguard duties on China
NEW DELHI : India is weighing its options to increase purchase of specialised steel – items not made in the country – from the USA as a counter to the proposed Trump tariffs. There are also plans to bring in safeguard duties as a control measure to protect domestic industry for competition from cheap Chinese dumping, top sources in the government told.
The Steel Ministry is reportedly negotiating with the DGTR (Directorate General of Trade Remedies) to speed up the probe into alleged Chinese steel dumping into India and the re-routing of offerings through FTA countries like Korea and Vietnam by making investments in steel-making capacities there.
India, the world’s second-largest producer of crude steel after China, is already a net importer of the metal, with China being one of the largest sellers, followed by Korea and Japan. Stainless steel imports into India are among the highest and have significantly impacted the country’s exim trade in the metal. Steel imports stood at 7.5 million tonnes for April–December, up 23 per cent year-on-year (y-o-y), outpacing exports, which fell 25 per cent y-o-y to 3.6 million tonnes.
A senior official said, “there has been no formal directive to buy steel from the US for diplomatic reasons”; but there have been discussions on “exploring ways to foster stronger trade relations” and this included “purchasing specialised steel from the US as and where it is mutually beneficial”.
The US is, incidentally, the third-largest steel-maker globally, with nearly 82 million tonnes of the metal being produced as of the last available numbers in 2022.
Trade Dynamics
India is a major stainless steel exporter to the US, and steel scrap – now a key raw material in view of its low carbon footprint – is the largest indirect purchase from there. Defence sector buying was previously seen as an option, but India is “mostly self-sufficient in the segment.”
As per last available reports, imports of steel from the US was around 16,000 tonnes (April – Dec) for the first nine months of the fiscal, which included 7,700 tonnes of steel pipes, 1,600 tonnes of galvanised plates and coils – both of which are specialised steel; and 5,000 tonnes of stainless steel.
According to Naveen Jindal, President, Indian Steel Association, the US is a major steel importer (and) has historically imposed strict trade restrictions, with over 30 remedial actions in force against Indian steel—some for more than three decades. “This latest tariff is expected to slash steel exports to the U.S. by 85 per cent, creating a massive surplus that will likely flood India—one of the few major markets without trade restrictions presently,” he said.
An industry source said, US imports are “relatively costly,” which has caused hesitancy to tap into the nation.
A second official said, Trump’s tariffs will certainly have an “impact on the sector”, and the industry, along with the Steel Ministry, is “looking to diversify exports”. “Focus is on enhancing domestic consumption, especially as infrastructure projects ramp up,” the official said.