India rules out tariffs on imports of US steel, aluminium for now

KOLKATA: India has deferred its plan to impose retaliatory tariffs on steel and aluminium imports from the US, which were to come into effect on Tuesday, till early November. The move comes in the wake of reports that US may be willing to exempt India from higher steel and aluminium tariffs as part of the discussions in the Indo-US trade talks.

The move may have a more pronounced impact on aluminium industry compared to steel. The tariffs were to be imposed in response to the Trump administration's move to raise import duties on Indian steel and aluminium products. Top aluminium industry sources said the tariffs on US imports would have been inconsequential since China accounts for the bulk of imports into India.

However, China’s imposition of 25% import duty on US scrap imports has led to higher diversion of scraps into India. As a result, aluminium scrap imports from US to India jumped 128% between Q1FY18 and Q1FY19 in volume terms to 36.2 kilo tonnes, according to data compiled by Aluminium Association of India.


A senior executive in a leading steel PSU said the amount of imports from the US is “not too high” and is largely restricted only to some items which are not widely used. Hence, the impact is not likely to be felt across the domestic steel industry. More significantly, a strong 6-7% growth in domestic demand has boosted the industry in last one year.

Deadline Extended
Meanwhile., the government, for the second time, has extended the deadline for imposition of higher customs duties on 29 products, including almond, walnut and pulses, imported from the US, till November 2. In June, India decided to impose tariffs from August 4. It was extended by 45 days till September 18. In a notification, the department of revenue, has said duties would come effect from November 2.