In a bid to protect the domestic steel industry, the Ministry of Steel has proposed a 25% safeguard duty on the import of certain steel items. This move comes in response to concerns raised by key players in the industry, including Steel Authority of India Limited (SAIL), Tata Steel, JSW Steel, and AMNS India.

The proposal was discussed during a meeting between Union Steel Minister H.D. Kumaraswamy and Commerce and Industry Minister Piyush Goyal. Senior officials from both ministries and representatives of the steel industry were also present at the meeting.

“We discussed ways for our ministries to collaborate and ensure ease of business for the steel and heavy industries, key sectors driving India’s growth,” posted Kumaraswamy on his X (formerly Twitter) post. He also added, “Strengthening the steel and heavy industries sector is critical for building a self-reliant India, and we will work tirelessly to create an enabling environment for its growth and global competitiveness.”

Notably, 43% of India’s steel was imported from China in the period of January-July 2024 according to data.

While the specific details of the proposed safeguard duty, including the duration and the exact items covered, are yet to be finalized, the move is likely to have a significant impact on the steel industry. It remains to be seen how the government will balance the need to protect domestic industry with the broader economic considerations, such as inflation and the cost of living.

Ministerial Support for Domestic Industry

Minister Goyal emphasized the vital role of the steel and metallurgical coke industries in India's development. He expressed a commitment to boosting domestic production, enhancing quality standards, and strengthening the global competitiveness of the sector.

Minister Kumaraswamy echoed these sentiments, stating that the two ministries would collaborate to create a favorable business environment for domestic steel producers. He highlighted the importance of fostering innovation, increasing domestic production, and positioning India as a global manufacturing powerhouse.

Addressing Industry Concerns

The proposed safeguard duty is aimed at mitigating the impact of increased steel imports, which have been a concern for the domestic industry. By imposing a higher tariff on imported steel products, the government aims to level the playing field and protect domestic manufacturers from unfair competition.

The steel industry has been facing challenges such as rising input costs, global economic uncertainties, and intense competition from foreign producers. The proposed safeguard duty is expected to provide some relief to the industry and help it navigate these challenges.