India Tightens Steel Procurement Rules to Shield Domestic Mills from Import Surge

The Indian government has taken several measures to protect steel manufacturers from an influx of cheaper imports and has tightened the rule of procuring local iron and steel products, which is required for all the central ministries and departments.

This new framework, specified in a notification titled “Domestically Manufactured Iron and Steel Products (DMI&SP) Policy 2025,” which was issued on April 1 , will be effective for 5 years and is renewable by the Ministry of Steel. It mandates all central government departments and organizations to give preference to domestically manufactured steel in public procurement contracts.

The move to tighten rules comes at a time of rising imports of finished steel, especially from China, South Korea and Japan. Imports from these countries reached a record during the first 10 months of FY2023–24 ended March 31, as per official data. A big fall in local steel prices has added to reasons of worry for Indian mills as the low-priced foreign steel is flooding Indian markets.

Restrictive tendering practices such as seeking foreign certifications or prescribing technical specifications in a way that excludes Indian manufacturers are explicitly barred in the policy. It also proposes a reciprocal provision: countries that prohibit Indian manufacturers from competing for public tenders in their country will be barred from contesting Indian government tenders, except for a few items that the Ministry of Steel said would be exempt.

Although the policy prioritises domestic production, it allows for certain exemptions concerning grades of steel that are not now produced in India or when a spurt of domestic capacity cannot match the volume requirements of the project.

This decision comes as a separate recommendation given by the Directorate General of Trade Remedies (DGTR) earlier which had recently recommended a 12% safeguard duty for 200 on specified steel imports. The DGTR noted the “serious injury” being caused to the domestic steel industry due to the glut of imports.

Collectively, these moves reflect India’s increasing focus on developing its capabilities in strategic sectors and on backing domestic industries against unfair foreign competition.