India’s steel industry, already reeling from cheaper imports, is worried about a surge in shipments from China after the United States imposed tariffs on Chinese steel, industry executives and analysts said.
US President Joe Biden on Tuesday unveiled steep tariff increases on an array of Chinese imports, including steel and aluminium.
“India is already under grave threat of import because all major steel consuming economies are shutting their doors on these steel producing countries,” said Alok Sahay, secretary general at Indian Steel Association (ISA).
“We are highly vulnerable to surging and predatory import,” Sahay said.
ISA counts the country’s top steelmakers, such as JSW Steel Ltd and Tata Steel Ltd, among its members.
Spooked by cheaper Chinese steel coming into India over the past two years, Indian steel producers have often complained about unbridled imports from Beijing.
Weak steel demand at home has encouraged China, the world’s biggest producer of the alloy, to offload its surplus stocks by offering competitive rates to Indian buyers, hurting Indian producers.
Steelmakers have lobbied India’s government to intervene to curb supplies from Beijing.
The government has resisted calls for curbs on imports, citing strong local steel demand, stoked by a spurt in economic activity.
India’s steel consumption rose 13.4 per cent to 136 million metric tons during the financial year to March 2024.
India turned a net importer of finished steel during the 2023/24 financial year. In 2023/24, China was the top steel exporter to India and its shipments reached 2.7 million metric tons, nearly double from a year earlier, according to provisional government data.
“Safeguards are essential, but nothing can happen till the new government is in place,” said a senior executive at a major steel firm. He didn’t wish to be named in line with his company’s policy.
India began voting on April 19 in a seven-phase election, with ballots set to be counted on June 4.
“If domestic prices and margins drop sharply due to an import surge, we expect the government to introduce tariff-related measures,” said Akash Gupta, a director at Fitch Ratings.