Steel Duty Hike Could Dent MSME CE Manufacturers, Warns JCB India CEO

The proposed 12% safeguard duty on imported non-alloy and alloy steel flat products could sharply impact micro, small and medium enterprises (MSMEs) in the construction equipment (CE) sector, warned Deepak Shetty, Managing Director & CEO of JCB India.

“Spot market steel prices have already surged by ₹4–5 per kg,” Shetty told reporters, adding that smaller players sourcing from the spot market will feel the brunt. “It will push up domestic manufacturing costs significantly.”

Shetty pointed out that the timing couldn’t be worse. Global exports are already under pressure due to ongoing disruptions in the Red Sea, which have forced shipments to reroute around the Cape of Good Hope—adding 15% in logistics costs and about two weeks in transit time. Now, rising steel prices could further erode India’s cost competitiveness.

“JCB India exports to over 130 countries,” he said. “In the global market, if we start losing our cost advantage, it becomes very challenging.”

The Indian Construction Equipment Manufacturers’ Association (ICEMA) has urged the government to monitor steel prices closely to curb speculative profiteering in the spot market.

The CE sector has expanded its global footprint in recent years. Thanks to the adoption of Stage V emission norms, Indian manufacturers can now sell to advanced markets like Europe. “This is a key opportunity,” said Shetty, “as we move up the value chain both technologically and environmentally.”

India is currently the third-largest market for construction equipment globally. JCB, which manufactures a wide range of machines domestically, has expanded its production capacity by 35–40% in the past five years.

“We’re confident that India will become the world’s second-largest CE market within the next five years,” Shetty said, “and we’re preparing to serve both domestic and global demand.”