According to a report by the policy think-tank Global Trade Research Initiatives (GTRI), the Directorate General of Trade Remedies’ (DGTR) recommendation to impose a three-year safeguard duty on steel imports will “severely hurt” India’s domestic automobile industry by increasing input costs and disrupting supply chains.
DGTR has suggested imposition of 12 percent safeguard duty in the first year, 11.5 percent in the second year and 11 percent in the third year which has been forwarded to the department of revenue under the ministry of finance for official notification and giving effect to the levy.
In April 2025, Indian government had imposed a provisional 12 percent safeguard duty on steel imports for 200 days.
GTRI pointed out that leading automobile manufacturers like Tata Motors Limited, Maruti Suzuki India Limited (MSIL), Hyundai Motors India Limited (HMIL), Toyota Kirloskar India Limited (TKIL), and others have submitted objections to the levy against imports arguing that it would inflate production costs, reduce export competitiveness and make customer specific steel grades difficult to source.
The Automobile Components Manufacturers’ Association (ACMA) has also submitted objections to the safeguard duty.
Imported hot-rolled coils landed at $450/mt in May 2025, nearly $87/mt cheaper than domestic supplies even after duties. The safeguard duty will force auto makers to absorb a higher landed cost or pass it on to consumers, GTRI said.
GTRI contended that Indian steel producers remain profitable, citing Tata Steel’s 21 percent SAIL’s 11.6 percent EBITDA (earnings before interest, tax, depreciation and amortization) margin and accused DGTR of shielding a handful of large steelmakers at the expense of downstream sectors.