Europe’s Proposal to Reduce Steel Import Quotas Poses Another Challenge for India

• Government claims new EU regulations will not have a significant impact

Mumbai: Following the U.S. decision to impose high tariffs on steel and aluminum, the United Kingdom’s proposal to regulate steel imports presents another challenge for India’s steel industry. However, the Indian government asserts that this proposal will not have a significant adverse effect.

According to sources from the Ministry of Commerce, strong domestic demand for steel will mitigate the impact of the European proposal on India’s steel industry.

The European Commission has announced that, starting in April, it will tighten steel import regulations to curb rising imports, which have put pressure on its steel industry.

The 27-nation European Union has decided to reduce import quotas, limiting the volume of tax-free steel imports.

While Europe’s proposal may have some impact, India’s rapidly growing steel consumption will help absorb any negative effects. Europe remains one of India’s key steel export destinations.

In the first 11 months of the current financial year, India exported 2.03 million tons of steel to Europe, accounting for 46% of the country’s total steel exports.

However, compared to domestic consumption, India’s steel exports remain relatively low.

In the previous financial year, India’s total steel exports stood at 7.5 million tons, while domestic consumption reached 136 million tons. Industry experts view Europe’s proposal as an additional challenge for India’s steel sector.

The proposed U.S. tariffs are also unlikely to have a significant impact on Indian steel producers, as India exports only a small volume of steel to the U.S. Furthermore, since China’s steel exports to the U.S. are also limited, it is unlikely that China will redirect its steel shipments to India, according to sources.