India imposes 12% safeguard duty on steel imports targeting China , Vietnam

The steel sector, has been reeling from the influx of low-cost imports, with imports being at a 10 year – high of 9 million tonnes. In a bold move to shield its steel industry, India has imposed a 12 per cent duty – also called safeguard - on import of non-alloy and alloy steel flat products, effective Monday, specifically targeting shipments from China and Vietnam. The duty is in effect for 200 days, unless amended or revoked.

The duty will include imports of products like hot-rolled coils, cold-rolled sheets, metallic coated steel and color-coated coils.

“...hereby imposes .... when imported into India, a provisional safeguard duty at the rate of twelve per cent ad valorem,” the notificaion said. It mentions “serious injury” to local manufacturers, with the potential for irreparable damage if action is delayed as a key reason for implementation.

Union Minister of Steel, HD Kumaraswamy, said, the move will protect domestic manufacturers and ensure fair competition. “We welcome 12 per cent safeguard duty on imported steel flat products. This will protect Indian manufacturers, ensure fair competition, and boost our domestic industry,” the Minister wrote, acknowledging the PM Narendra Modi’s intervention in the matter. According to TV Narendran, CEO & MD, Tata Steel, safeguard duty imposition is a critical step in addressing the surge of unfairly priced imports to India. “Unchecked imports — especially from countries with significant excess capacity — threaten domestic manufacturing, employment, and future investments. This decision will help restore fair competition, ensure the industry’s long-term sustainability,” he said.

The DGTR in a probe had mentioned that “there is a recent, sudden, sharp, and significant increase in imports of subject goods into India”; while threaten to cause serious injury to the domestic industry and producers. It also noted, there exists critical circumstances, where any delay in application of provisional safeguard measures would cause damage a and recommended 12 per cent provisional duty.

According to Harsh Bansal, MD of BMW Industries, quantum could have been a bit more. “They will see that the market doesn’t move to cheaper imports. The government will also have to ensure the headline inflation remains within target range,” he said.

“This important step will protect Indian manufacturers from unfair imports and boost domestic production,” Naveen Jindal, President, Indian Steel Association, said. However, not all imports face the levy.

Steel products priced above specific thresholds—$675 per tonne to $964 per tonne, depending on the category— are exempt to ensure high-value imports remain unaffected.

Developing nations, except China and Vietnam, escaped the duty, aligning with India’s trade commitments. Exclusions are extended to specialised products like stainless steel, tinplate, and electrical steel, safeguarding niche markets. In total there are 22 product specific exemptions.

The exchange rate for duty calculations, tied to the Customs Act of 1962, adds another layer of complexity for importers navigating volatile markets.