SINGAPORE — Domestic steel markets in India could be distorted considerably once the United States imposes its proposed 25% tariff on imported steel.
This is due to steel-surplus nations diverting their cargoes to countries such as India, which continues to consume steel actively, the Indian Steel Association (ISA) said on Wednesday March 7.
Including India inside the tariff list was also not appropriate because India sent limited quantities of steel to the US, ISA secretary general Bhaskar Chatterjee said.
“A total of 16 trade remedies are already in place in the US against Indian steel companies, which includes 10 anti-dumping duties and six countervailing duties… making it nearly impossible to export to the US,” Chatterjee said.
These duties are imposed on corrosion-resistant steel, cold-rolled flat steel, certain hot-rolled flat steel and cut-to-length steel plate.
India exported 752,348 tonnes of steel to the US in 2017, up from 318,416 tonnes in 2016, according to data from the US Department of Commerce.
Line pipe made up the majority of the exports, with India shipping 392,950 tonnes of such products to the US in 2017. It also sent 93,538 tonnes of hot-dipped galvanized sheet and strip and 76,347 tonnes of semi-finished steel that year.
Other significant quantities included 33,498 tonnes of mechanical tubing, 21,748 tonnes of standard pipe and 26,912 tonnes of wire rod.
India’s steel products are also mainly for domestic consumption and not meant for exports, Chatterjee said. He argued that this warranted a distinction between India and countries that exported most of their steel.
“The nominal quantities that India exports every year are aimed at maintaining a connection with international markets as well as adhering to global industrial and technical benchmarks,” he said.
The ISA said that the tariff would ultimately hinder India’s economic growth prospects and was not desirable because India had always exported steel to the US within global trade regulations.
US President Donald Trump is widely expected to impose tariffs on imports of steel as well as aluminium products this week, following recommendations made by the Department of Commerce’s upon the conclusion of its Section 232 probe on whether such imports posed a national security threat. This has resulted in widespread protest and threats of retaliatory measures by major steel-producing countries.
Market participants in several countries in Asia - Vietnam, Japan and South Korea - have also raised concerns about how the tariffs would affect certain steel products.