GTRI Urges for Assessment of Steel Before Imposing Safeguards

The Global Trade Research Initiative (GTRI) has demanded that a complete review of the Indian steel industry be done to assess the impact of existing import regulations before proceeding with new safeguard duties. It emphasized that on the economic front, this should be a balance, and decisions shouldn’t be taken in haste without the economic implications being understood.

According to GTRI’s latest report, the ongoing safeguard investigation initiated by the Directorate General of Trade Remedies (DGTR) concerning the alleged surge in imports of specific steel products has brought out multiple technical flaws. The report says that it is reprobating DGTR’s evaluation favoring minor import spikes and that the misuse of global safeguard mechanisms could provoke challenges before the WTO.

Ajay Srivastava, Founder of GTRI, emphasized the importance of understanding the implications of existing measures on costs, economic growth, and job creation. “A thorough study on the state of the steel industry and its existing import frameworks is essential. Actions should always be based on data and never the result of some hasty reaction,” Srivastava said.

The report also underlines the inefficiencies existing in the above-described system, which includes QCOs, SIMS, and NOC requirements. It suggested simplifying these processes and collaborating with international labs to streamline compliance for foreign manufacturers.

The DGTR’s investigation, initiated in December, focuses on imports of ‘Non-Alloy and Alloy Steel Flat Products,’ critical inputs for industries such as construction, automotive, and electrical panels. However, industry stakeholders, including MSME exporters, have raised concerns. Hand Tool Association Chairman S.C. Ralhan warned that imposing additional duties would escalate production costs, making Indian products uncompetitive in global markets.

The Indian Steel Association, representing major players like JSW Steel and Steel Authority of India, has petitioned for a safeguard duty under the Customs Tariff Act, citing excess production capacity in countries like China, Japan, and South Korea as a threat to domestic producers.

Despite these concerns, India met 94% of its steel demand through domestic production in FY2024, with imports accounting for just 6%. Crude steel production rose from 109.14 million tons in 2019-20 to 144.04 million tons in 2023-24, reflecting robust domestic capabilities.

GTRI cautioned that any new measures should carefully balance protecting domestic players and supporting broader economic growth.