Indian Steel Industry Grapples with Declining Exports as Trump Targets Foreign Steel Investments

New Delhi, Dec 3 (KNN) At a time when Indian steel companies are grappling with declining exports, US President-elect Donald Trump has signalled the possibility of new tariffs on imported steel to protect the American steel industry. 

On Tuesday, Trump declared his opposition to a potential acquisition of Pennsylvania-based US Steel by Japan's Nippon Steel, asserting that he would block the deal using tariffs and tax incentives to strengthen the American steel sector.

"I am totally against the once great and powerful U.S. Steel being bought by a foreign company, in this case, Nippon Steel of Japan," Trump stated. "Through a series of tax incentives and tariffs, we will make the U.S. Steel strong and great again, and it will happen FAST!”, reported Indian Express.

Trump’s comments coincide with a challenging period for India’s steel industry. The country is facing a sharp decline in steel exports, while imports have surged by 41 per cent in the first half of the financial year. 

Exports have fallen by 36 per cent, according to official data, reflecting the intense competition in global markets and a rise in cheaper steel imports.

The Indian government is taking steps to address these concerns. The Steel Ministry, after meeting with industry stakeholders, proposed a 25 per cent safeguard duty on certain steel items to shield domestic producers from the growing influx of imports. 

Despite this, Indian steel companies are struggling with profitability, partly due to international dumping practices that have suppressed prices.

Steel Secretary Sandeep Poundrik highlighted the country's increasing steel consumption, which grew by 13 per cent in the first half of 2024-25, driven by a surge in infrastructure and public spending. 

However, with rising imports, steel companies are seeing their inventory levels soar, and profit margins are under pressure. 

The industry now faces a dilemma over how to protect domestic producers, especially considering that 62 per cent of imports come from Free Trade Agreement (FTA) countries, where higher duties would have no effect.

As Indian steel manufacturers brace for further pressure, international factors, including Trump’s tariff rhetoric, threaten to escalate challenges in an already volatile market.

(KNN Bureau)