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For India’s steel industry, what was feared is coming true. Preliminary government data suggests this. Import of finished steel China set a new record in the first eight months of the fiscal year ending March 2025. The news quickly raised concerns among domestic steelmakers about the arrival of cheap Chinese shipments.

India is the second largest producer of crude steel in the world. However, the subcontinent turned into a net importer during this period, with imports of finished steel reaching an eight-year high. Overall, imports rose to 6.5 million metric tons (MT), up 26 percent from last year.

According to the latest data, China supplied 1.96 mmt of steel to India between April and November this year, which is 22.8 percent higher than the previous period. Among the key exports from China were stainless steel, hot-rolled coils, plates, electrical sheets, pipes, bars, rods and galvanized sheets. Manufactured steel from Japan also rose, doubling to a six-year high of 1.4 MMT.

During these months, about 80% of India’s total finished steel imports came from China, Japan and South Korea. The most imported item was hot-rolled coil, followed by bars and rods in the non-flat product segment.

India has started investigating Chinese imports.

In response to the surge in imports, New Delhi has launched an investigation to determine whether India has a Duty to protectA temporary tax on steel imports. India’s Business Standard newspaper reported that the Indian Steel Association (ISA) had earlier expressed concern over a significant increase in imports of certain steel flat products.

Soon after, the Directorate General of Trade Remedies (DGTR), an agency of the Ministry of Commerce, launched an investigation.

The probe focuses on imports of “non-alloy and alloy steel flat products”, which are widely used in industries such as fabrication, pipe-making, construction, capital goods, automotive, tractors, bicycles and electrical panels.

According to the DGTR notification, ISA has identified key members such as ArcelorMittal Nippon Steel India, AMNS Khopoli, JSW Steel, JSW Steel Coated Products, Bhushan Power & Steel, Jindal Steel & Power and Steel An application has been filed representing the Authority of India. The Customs Tariff Act, 1975 calls for imposition of safeguard duty on these imports.

India made its case against Asian imports

The ISA alleged that there was a sudden, sharp increase in import volumes, which it claimed caused “serious injury” to the domestic steel industry. He argued that Chinese imports threatened the competitiveness and viability of local producers.

To address this issue, the association requested safeguard duties to protect domestic manufacturers of similar or directly competing products from further injury and possible threats from increased imports.

World Trade Organization member countries can deploy measures such as duties or quantitative restrictions as a way to prevent cheap imports. These measures are aimed at creating a level playing field for domestic industries that are facing a sudden and significant increase in imports.

According to some industry experts, the increase in imports was related to substantial excess production capacity in countries such as China, Japan and South Korea, which was driven by reduced domestic demand in those markets.

Steel Industry is pushing for 25% duty.

As a counter to the challenge of cheap imports, India’s steel industry has advocated for a Duty to protect Up to 25%, including in Free Trade Agreement (FTA) partner countries.

However, a final decision on the matter is yet to be taken. Most analysts agree that once the DGTR completes its investigation, it can recommend the imposition of duty to the Board of Safeguards. If approved, these duties will apply to all of India’s trading partners.

Whatever the steel industry may wish, the final decision on the imposition of such duties rests with the Ministry of Finance and will be based on the recommendations of the Ministry of Commerce. Currently, about 60% of India’s steel imports come from FTA countries.

According to media reports, these nations currently enjoy zero duty concessions. Meanwhile, government sources suggest that they may be exempted from the duty hike.

By Sohrab Daryabsha

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