Biz Updates: Steel Secretary said – American tariffs do not have much impact on the steel industry, Moody’s gave its reaction

New Delhi| America’s announcement of imposing duty on steel imports will not have much impact on Indian industry, as the domestic market is strong and small quantities of steel are exported to America. Steel Secretary Sandeep Pounderik said. President Donald Trump has said he will announce an additional 25 percent tariff on all steel and aluminum imported from various countries on Monday.

“The US President has talked about imposing tariffs on steel”, the official said at an event organized by the Bengal Chamber of Commerce and Industry (BCC&I). How much steel do we actually export to the US? We produced 145 million tones of steel last year, of which 95 000 tones were exported to the US. So, what difference does it make that out of 145 million tones you are not able to export 95,000 tones”

Addressing the ‘Mineral Mining and Metals Conference’, he said that India’s domestic market is so strong and consumption is also increasing that it will become difficult for the steel industry to meet it in the coming years. In 2018, however, when the U.S. imposed taxes on steel and aluminum, India retaliated by raising tariffs on 29 U.S. products, earning it equal revenues. Additionally, regarding exports, Poundrick said it would become a problem, as more and more countries would impose security measures and sanctions.

According to official data, India’s exports declined by 28.9 per cent to 3.99 million tones during the April-January period of FY2025, compared to 5.61 million tones in the same period of the previous fiscal year. The country remained a net importer of steel and imports increased by 20 per cent to 8.29 million tones during the April-January period of the current fiscal year.

Moody’s gave this reaction on American tariffs
Indian steel producers will face challenges in exporting their products following US President Donald Trump’s decision to impose an additional 25 per cent duty on all steel and aluminum imports as announced, Moody’s Ratings said on Monday. High imports of steel into India over the past 12 months have already driven down prices and incomes of steel producers in India, said Hui Ting Sim, assistant vice president at Moody’s Ratings.

Since the trade war began in 2018, imports of steel and aluminum into the U.S. have been steadily increasing, according to data from the think tank Global Trade Research Initiative (GTRI). Imports of primary steel increased from USD 31.1 billion in 2018 to USD 33 billion in 2024. The largest suppliers in 2024 were Canada (US$7.7 billion), Brazil (US$5 billion) and Mexico (US$3.3 billion). Imports from China and India amounted to USD 550 million and USD 450 million respectively.

GTRI founder Ajay Srivastava said, “If Trump follows this strategy, the withdrawal of tariffs on steel and aluminum can be used as an advantage in trade talks”. The 2018 tariffs were widely seen as an aggressive strategy to force trading partners to make concessions. If the latest move is implemented, it could lead to new trade disputes and retaliatory measures on the part of affected countries

Moody’s said it expects the tariffs to benefit steel producers in the US, as they will increase domestic steel demand and increase their selling prices. Trump said Sunday that he would announce new tariffs on steel and aluminum imports on Monday. Trump also confirmed that he would announce “reciprocal tariffs”-possibly on Tuesday or Wednesday-meaning the U.S. would impose import duties on those products.

“U.S. tariffs on steel will increase competition and increase oversupply in other steel-producing markets”, Hui Ting Sim said. Indian steel producers will face more challenges in exporting their products” Earlier in 2018, under Trump’s presidency, Washington imposed additional import duties of 25 percent on steel products and 10 percent on some aluminum products. In retaliation, India had imposed additional customs duties on 28 US products in June 2019. On 3 July 2023, more than five years after the initial tariffs were imposed, the US had lifted tariffs on imports of steel and aluminium from India.

GTRI said in its report that the decision was part of a broader trade resolution announced during Prime Minister Narendra Modi’s visit to Washington. This agreement has softened trade relations between the two countries, in which India has committed to further open its market for American goods.

“As Trump considers reviving his aggressive trade policies, the world will monitor him closely”, Srivastava said. If history repeats itself, the U.S. steel and aluminum industries could benefit in the short term, but global trade friction could increase, with long-term economic consequences.”

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