India Considers Extending Import Tariffs on Steel Products to Counter Cheaper Chinese Shipments

India is assessing a proposal to extend import tariffs on certain steel products as the government moves to curb the rising challenge of cheaper shipments arriving mainly from China. A senior source with direct knowledge of the matter confirmed to Reuters that the extension of the safeguard duty is actively under review, adding that the issue has gained urgency due to the pricing pressure created by global oversupply.

The safeguard duty, which acts as a protective tariff, had earlier been imposed temporarily at 12 percent for a period of 200 days. This measure expired earlier this month, prompting industry bodies and policymakers to revisit the need for continued intervention. According to the source quoted by Reuters, the Ministry of Finance is currently examining the recommendation made by the Directorate General of Trade Remedies, which had earlier advised a three-year duty in the range of 11 to 12 percent on select steel categories.

India, which holds the position of the world’s second-largest producer of crude steel, has seen a notable shift in import trends this financial year. Official data indicates that finished steel imports in the first seven months have declined by 34.1 percent year-on-year. Despite this drop, the composition of import sources remains significant. South Korea has emerged as the top exporter to India with 1.4 million metric tonnes supplied, followed by China, Japan and Russia.

The growing influence of Chinese steel in the international market has been a concern for Indian policymakers as well as domestic manufacturers. The Reuters source noted that China’s pricing advantage has made India “vulnerable”, especially at a time when Chinese production is declining for the first time in six years. Reports from China’s state-backed steel association indicate that output will fall below one billion tonnes this year, aligned with Beijing’s push to reduce excess capacity.

In late October, China unveiled a stricter capacity-swap proposal aimed at balancing supply and demand in the steel sector. Indian officials are closely watching these developments as they weigh the potential impact on domestic producers, global pricing behaviour and long-term competitiveness.