Safeguard Duty on Steel Imports May Halt Construction Equipment Industry, Warns ICEMA

The Indian Construction Equipment Manufacturers Association (ICEMA) has sounded a warning over a proposed 12% safeguard duty on steel imports, stating that it could cause disruption in manufacturing, drive up costs, and put at risk vital infrastructure projects all over India.

In a communiqué released today, ICEMA reiterated that steel—particularly the high-strength and high-tensile type, specialized tubes and pipes—and other specialized segments are critical material inputs to the industry. While most of them are not domestically manufactured, imported supplies become extremely important in delivering quality and volumes.

The CE industry, now worth about USD 9.5 billion, is ranked third in the world after the U.S. and China. It supports major infrastructure projects in roads, railways, and city development. An increase in steel input prices, ICEMA cautioned, would compel producers to shift the burden to consumers, lengthen project schedules, and increase total infrastructure expenses.

Even before the intended duty comes into force, uncertainty in the market has resulted in a sudden rise in steel prices—almost by ₹10,000 per tonne—since the Directorate General of Trade Remedies (DGTR) started its investigation This spike adds pressure to an industry already absorbing the cost impact of the recently implemented CEV Stage V emission norms, which came into force on January 1, 2025.

ICEMA also flagged concerns about long-term competitiveness. With global manufacturers shifting to “China plus One” strategies, Indian CE makers are poised to capture new export opportunities. However, rising input costs could undercut this momentum, making Indian products less competitive in global markets.

Calling for a transparent review process, ICEMA urged the government to assess the broader implications of the safeguard duty. The association advocates for a policy that balances domestic steel industry support with the operational needs of downstream sectors like CE manufacturing.

“The need of the hour is a consultative and measured approach that protects India’s infrastructure goals while enabling industry to grow sustainably and remain globally competitive,” the statement concluded.