Trump effect: Trade ministry unit advocates 12% duty on steel imports, citing concerns over ‘trade diversion’

India Considers 12% Steel Import Duty Amid Global Trade Uncertainty

India's trade ministry has recommended imposing a 12% duty on certain steel imports, a move industry experts are calling the "Trump effect" as policymakers brace for potential global trade shifts. The proposal comes amid growing concerns that former U.S. President Donald Trump's possible return to office could trigger another wave of trade protectionism, redirecting steel exports to markets like India.  

The Directorate General of Trade Remedies (DGTR), the investigative arm of India's commerce ministry, suggested the tariff after domestic steel producers warned of possible "trade diversion." Steel manufacturers argue that if Trump reinstates his aggressive tariff policies, countries facing U.S. trade barriers might flood the Indian market with cheap steel, undercutting local producers. The proposed duty would primarily apply to flat-rolled steel products from China, South Korea, and Vietnam.  

Domestic steel companies, including major players like JSW Steel and Tata Steel, have welcomed the potential measure. "This is about protecting our industry from unfair competition and preserving jobs," said a representative from the Indian Steel Association. However, the move has drawn criticism from steel-consuming sectors such as automotive and construction, where companies fear higher input costs could eventually trickle down to consumers.  

The debate mirrors India's 2018 decision to raise steel import duties to 12.5% in response to Trump's initial tariffs. While that move helped shield local manufacturers, it also increased costs for infrastructure projects. Now, with Trump leading in early U.S. election polls, Indian authorities appear to be taking preemptive action to avoid market disruption.  

The final decision rests with India's finance ministry, which could implement the new duty within weeks if approved. As global trade tensions simmer, the proposal highlights how political developments in one country can send ripples through international markets, forcing nations to recalibrate their economic defenses.