The government has recommended a 12 per cent safeguard duty on certain steel products for 200 days to protect the domestic industry from the serious injury caused by a recent spike in imports.

A safeguard duty is a temporary tariff barrier imposed to shield domestic industries from a surge in imports.

“Therefore, the Authority recommends imposition of provisional safeguard duty at the rate of 12 per cent ad valorem for 200 days pending final determination on imports of the product under consideration,” the Directorate General of Trade Remedies (DGTR) said in an order on Tuesday. The order noted that imposing the measure is critical under the current circumstances, and any delay would cause damage that would be difficult to repair. “There is a necessity for immediate application of provisional safeguard measures,” it added.


India’s imports of finished steel from China, South Korea, and Japan have been high. However, a trade diversion caused by the protective measures imposed by the United States in 2018 has been a major factor behind the surge in imports, according to the findings. To counter this, the European Union imposed a safeguard duty in the same year, followed by several countries, including South Africa, Turkey, Vietnam, and Malaysia, which also raised barriers against steel imports.

"To counter the trade diversion from the US as well as any possible diversion from other countries that have put in place import barriers, any protective measure by India shall be at a level adequate to ward off the trade diversion," the order stated.

The DGTR, under the administrative control of the commerce department, has invited comments on its findings within 30 days, after which an oral hearing will be held before passing the final order.

Product categories such as stainless steel, cold-rolled grain-oriented electrical steel, and aluminium-coated steel have been excluded from the duty.