Chinese Steel Flooding India Through FTA Loopholes: JSW Chairman Sajjan Jindal

Sajjan Jindal, Chairman of JSW Group, has raised alarms over the surging inflow of Chinese steel into India, largely facilitated through Free Trade Agreements (FTAs) with ASEAN countries. Speaking to Moneycontrol, Jindal highlighted that China’s steel exports are equivalent to India’s total production, creating an uneven playing field for domestic manufacturers.

While Chinese steel faces significant tariffs in markets like the U.S. and Europe, Jindal noted that it enters India indirectly via third-party nations with FTA benefits. “These countries import Chinese steel for their domestic needs and export their own steel to India without tariffs, effectively allowing duty-free entry of Chinese steel,” he explained.

This practice, according to Jindal, undermines India’s steel industry by enabling cheaper imports, affecting local producers’ competitiveness. JSW Group, one of India’s largest steel manufacturers, has consistently voiced concerns to the government, urging corrective measures.

Jindal revealed that the government is aware of this issue and is exploring solutions. However, no decisive action has been taken yet. “We’ve raised this issue, and discussions are ongoing. It’s critical to address this loophole to protect the industry,” he said.

India’s steel manufacturers have long contended with competition from cheaper imports, particularly from China, the world’s largest steel producer. In response, the government has implemented measures like export duties on steel and reduced import duties on raw materials to stabilize the domestic market.

In May 2022, a 15% export duty was introduced to curb rising steel prices and inflation, ensuring adequate supply for the local market. This move was rolled back in November 2022, a decision welcomed by the industry. Despite these efforts, the unchecked influx of Chinese steel through FTA nations continues to pose challenges.

Jindal’s remarks underscore the broader complexities of global trade policies and the impact of overproduction in other nations on India’s manufacturing sector. He remains optimistic that government intervention will ensure fair competition for Indian steel producers.