India weighs 25% duty on steel to curb cheap Chinese imports: report

India is planning to levy a 25% safeguard duty on steel imports to protect domestic manufacturers from a surge in cheaper imports, mainly from China and South Korea, Reuters reported, citing people aware of the discussions.

The safeguard duty is likely to be levied after an investigation, that may be completed in a month, the report said, citing an industry official who attended a board meeting chaired by commerce minister Piyush Goyal.

Large steelmakers are likely to supply small manufacturers steel at reduced prices to address the latter’s concerns over affordable raw material supplies, the report added.

The medium, small and micro enterprises (MSMEs) registered with the government may receive steel at free on board (FOB) export prices, about 20% lower than market rates, Engineering Export Promotion Council of India chairman Pankaj Chadha said.

The FOB export price is the cost of steel as it is loaded onto the shipping vessel for export, excluding additional costs such as freight or insurance.

The Directorate General of Trade Remedies is looking into whether cheap imports from China affected domestic steel manufacturers.

The government is expected to decide on imposing the temporary safeguard duty once the investigation concludes.

Imports have risen by over 62% year-on-year, causing industry concerns over falling prices and margins.

The steel ministry has recommended a 25% duty on flat-steel products for two years to curb cheap Chinese imports.

Major producers, including JSW Steel Ltd, Tata Steel Ltd, and ArcelorMittal Nippon Steel India, have voiced concerns over the growing imports of low-cost steel.

India, the world’s second largest crude steel producer, became a net importer last fiscal.

The proposed safeguard duty aligns with broader goals of decarbonizing steel production and promoting “green steel.”