New Delhi's move comes as Trump's tariffs threaten to prompt East Asian exporters to redirect US-bound shipments

India has imposed a 12% duty on steel imports in an effort to counter a substantial increase in low-cost shipments from countries such as China, the Finance Ministry in New Delhi stated on Monday. 

Safeguard duties are typically imposed when a country's domestic industry is facing significant threats from imports. The move comes after the administration of US President Donald Trump imposed 25% tariffs on steel and aluminum imports. 

The steep tariffs could force steel exporters to dump their products in other markets, with India being a prime target. Indian Steel and Heavy Industries Minister H. D. Kumaraswamy said the introduction of a safeguard duty will bring crucial relief to domestic producers, particularly small and medium-scale enterprises, which have been heavily impacted by the surge in imports. 

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India, the world's second-largest crude steel producer, concluded the 2024-25 fiscal year as a net importer of finished steel for the second consecutive year. According to preliminary data, imports reached a nine-year high of 9.5 million metric tonnes.

A significant portion of these imports, approximately 78%, came from China, South Korea, and Japan, a government report said. During the first ten months of the fiscal year ending March 2025, imports from these countries hit record highs. The surge has posed a significant challenge to domestic steel producers, particularly smaller mills, which have been forced to reduce production and consider layoffs, according to reports.

The move is New Delhi's first big trade policy shift since Trump imposed a wide range of tariffs on countries in April, kicking off a bitter trade war with China. Earlier his month, India set up a committee to monitor and prevent diverted goods from the US and China from entering the country due to the ongoing trade war, local media reported. 

Headed by Commerce Secretary Sunil Barthwal, the committee comprises officials from various ministries and customs agencies, and has been set up to monitor the influx of goods.

Enforcement of the proposed US tariffs was delayed by a 90-day pause to allow time for negotiations. Currently, US Vice President J.D. Vance is in India to discuss progress on a bilateral trade deal between the two countries.