GST Reforms Emerge as Key Buffer Against U.S. Tariffs: AIIFA

New Delhi, Sep 6 (KNN) On September 5, 2025, Yogesh Mandhani, President of the AIIFA Sustainable Steel Manufacturers Association, emphasised the pivotal role of Goods and Services Tax (GST) reforms in countering the adverse impact of U.S. tariffs on India’s economy.

Mandhani noted that by rationalising GST, the reforms have effectively stimulated demand and provided much-needed support to the domestic secondary steel sector, which currently contributes 47% of India’s total steel production.

He also highlighted the sector’s moderate capacity utilization—hovering between 68–70%—and suggested that targeting export markets could further enhance efficiency and utilization.

Beyond tax relief, Mandhani called for complementary policy moves, including quicker mining auctions and power tariff rationalization.

He argued that these steps would increase iron ore availability, reduce production costs, enable greater export competitiveness, and bolster the economic footprint of secondary steel manufacturers.

These remarks come amid broader optimism about the GST overhaul’s wide-ranging impact. Analysts from other sectors have echoed its benefits—pointing to potential boosts in consumption, reduced compliance burdens, and improved resilience against global trade shocks.

Similarly, Commerce Minister Piyush Goyal has described the GST rationalization as “game-changing,” urging industries to pass on the advantages of rate cuts to consumers to maximize its positive effects.

In summary, Mandhani argues that the evolving GST framework, coupled with strategic mining and power sector reforms, is positioning India’s secondary steel industry—and the wider economy—to better withstand external trade pressures, particularly from steep U.S. tariffs.

(KNN Bureau)