In a move to shield its domestic steel industry from a flood of inexpensive imports, particularly from China, India has implemented a temporary safeguard duty of 12% on certain steel products. The Ministry of Finance issued an official order on Monday, April 21, stating that this duty, effective immediately, will remain in place for 200 days, unless it is revoked, superseded, or amended earlier.

This decision follows a recommendation by the Directorate General of Trade Remedies (DGTR), which, after an investigation initiated in December 2024, concluded that a surge in imports was causing "serious injury" to local steel manufacturers. The investigation was prompted by concerns raised by the Indian Steel Association, representing major players like JSW Steel, Tata Steel, and the Steel Authority of India.

India, despite being the world's second-largest crude steel producer, has become a net importer of finished steel for the past two fiscal years. In the 2024/25 fiscal year, finished steel imports reached a nine-year high of 9.5 million metric tons. Notably, a substantial 78% of these imports originated from China, South Korea, and Japan. Imports from China alone saw a significant increase, making it the top exporter of finished steel to India during the April-December 2024 period, with 2.1 million metric tons shipped.

The influx of cheaper steel has forced some Indian mills to reduce their operations and consider job cuts. The safeguard duty aims to make imported steel more expensive, thereby allowing domestic producers to compete on a more level playing field. The duty will apply to specific non-alloy and alloy steel flat products, including hot-rolled coils, sheets, and plates, as well as cold-rolled coils and sheets and metallic coated steel coils and sheets. However, the notification specifies that the safeguard duty will not be imposed on product categories if their import price (Cost, Insurance, and Freight) exceeds a certain threshold, which varies for different product types. For instance, hot-rolled coils imported at $675 per tonne CIF or higher will not attract the safeguard duty.

Union Minister for Steel and Heavy Industries, H. D. Kumaraswamy, welcomed the imposition of the safeguard duty, emphasizing that it is a "timely and necessary step to protect domestic steel manufacturers from the adverse impact of import surges and to ensure fair competition in the market." He further stated that this measure would provide crucial relief, especially to small and medium-scale enterprises that have been significantly affected by rising import volumes.