India Imposes Up to 12% Safeguard Duty on Steel Imports From China, Vietnam, and Nepal
India has implemented a three-year safeguard duty of up to 12% on steel imports from China, Vietnam, and Nepal following a DGTR investigation that found surging low-priced imports were causing serious injury to domestic steelmakers. The duty will be phased down from 12% to 11% over three years, replacing a provisional duty that expired in November 2025, and is expected to improve competitiveness of Indian producers by raising Chinese HRC landed costs from ₹48,040.00 to approximately ₹55,465.00 per tonne.
*this image is generated using AI for illustrative purposes only.
India has imposed a safeguard duty of up to 12% on select steel imports from China, Vietnam, and Nepal for three years, following an investigation that found surging low-priced imports were causing serious injury to the domestic steel industry. The measure aims to protect Indian steelmakers from sudden import shocks and restore competitive balance in the market.
Investigation Findings and Rationale
The Directorate General of Trade Remedies (DGTR) conducted an investigation that revealed imports of alloy and non-alloy steel flat products had risen suddenly and sharply, hurting Indian manufacturers. The investigation concluded that cheaper foreign steel led to significant market share loss for domestic producers, created pricing pressure, and weakened capacity utilisation and profitability. The DGTR determined that the injury was material and ongoing, with domestic producers unable to compete effectively against underpriced imports.
Duty Structure and Implementation
The safeguard duty will be implemented in a phased reduction approach over the three-year period:
| Period | Duty Rate |
|---|---|
| April 2025 to April 2026 | 12% |
| April 2026 to April 2027 | 11.5% |
| April 2027 to April 2028 | 11% |
This final measure replaces a 12% provisional safeguard duty that was imposed in April and expired in November 2025. The duty applies specifically to imports originating from the People's Republic of China, Vietnam, and Nepal.
Market Impact and Pricing Analysis
Market data demonstrates the competitive pressure faced by Indian steelmakers before the duty implementation. Chinese hot-rolled coil (HRC) was being imported at a landed cost of approximately ₹48,040.00 per tonne, compared with domestic HRC prices of around ₹47,200.00 per tonne. This pricing structure made imports competitive even without tariff advantages, creating unfair competition for domestic producers.
| Steel Type | Price per Tonne |
|---|---|
| Chinese HRC (landed cost) | ₹48,040.00 |
| Domestic HRC | ₹47,200.00 |
| Chinese HRC (with 12% duty) | ₹55,465.00 |
Expected Benefits for Domestic Industry
The safeguard duty is expected to provide immediate relief to domestic steel producers through several mechanisms. With the 12% duty, the landed cost of Chinese HRC could rise to approximately ₹55,465.00 per tonne, significantly reducing the price gap and improving the competitiveness of Indian producers.
Industry participants anticipate the measure will help:
- Prevent margin erosion and financial stress
- Restore fair competition against underpriced imports
- Support stable production planning and domestic pricing
- Provide insulation from sudden import shocks
- Restore pricing discipline in the domestic market
The three-year implementation period with gradual duty reduction is designed to provide domestic steelmakers with sufficient time to strengthen their competitive position while allowing for market adjustment.
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