India Imposes Temporary 12% Tariff on Steel Imports

NEW DELHI, April 21, 2025 — India has announced a temporary 12% tariff, officially termed a safeguard duty, on certain steel products to counter the surge of low-cost imports, particularly from China. The measure, effective immediately, aims to protect the country’s domestic steel industry, which has faced mounting pressure from cheaper foreign supplies, according to a government notification issued Monday.

The Ministry of Finance stated that the safeguard duty will remain in effect for 200 days unless amended or revoked earlier. This marks India’s first significant trade policy action since the United States, under President Donald Trump, introduced sweeping tariffs on global imports earlier this month. China, the second-largest exporter of steel to India after South Korea in the 2024-25 fiscal year, is the primary target of New Delhi’s tariffs, Reuters reported.

The decision follows extensive investigations by Indian authorities, including the Directorate General of Trade Remedies, which recommended the duty last year to curb the influx of non-alloy and alloy steel flat products. These imports, predominantly from China, Japan, and South Korea, accounted for 78% of India’s steel imports, according to government sources cited by The Indian Express. The temporary tariff is expected to reduce steel imports by up to 50% in the 2025-26 fiscal year, boosting profitability for domestic manufacturers like Tata Steel and JSW Steel, per industry analysts quoted on X.

“This safeguard duty is a critical step to shield our steel industry from the adverse effects of unbridled imports,” a government official told Reuters, emphasizing the need to support local producers amid global trade uncertainties. The move aligns with India’s broader strategy to bolster its manufacturing sector, especially as global trade tensions escalate following U.S. tariffs of up to 245% on Chinese goods, as reported by Yahoo Finance.

However, the tariff could raise material costs for micro, small, and medium enterprises (MSMEs) reliant on imported steel, potentially impacting sectors like construction and automotive, noted The Indian Express. The Engineering Export Promotion Council also warned that U.S. tariffs on Indian steel exports could lead to a $4-5 billion drop in shipments, complicating India’s trade landscape.

India’s steel tariff comes amid heightened global trade frictions, with the World Trade Organization projecting a 0.2% decline in global merchandise trade volume for 2025, largely due to tariff-related uncertainties. As India navigates its role in the BRICS alliance alongside China, the tariff underscores a delicate balance between economic cooperation and protecting national interests.

Sources: Reuters, The Indian Express, Yahoo Finance

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