Govt plans support package for steel, aluminium sectors amid US tariffs

The government is preparing a support package to help steel and aluminium industries after the US hiked import tariffs to 50 per cent, raising concerns of dumping and demand slump

The steel ministry has urged the Ministry of Finance to double the basic Customs duty on imported finished steel products to 15 per cent from the current 7.5 per cent in the upcoming Union Budget for 2025–26, people aware of the matter said. — The tariff escalation could also result in dumping of excess steel and a fall in domestic prices.

2 min read Last Updated : Sep 09 2025 | 6:43 PM IST

The government is preparing a relief package for industries hit by the US tariffs under the steel and aluminium sectors, a senior commerce ministry official said on Tuesday.

“In response to the 50 per cent tariffs imposed by the US on Indian goods, we are discussing with the industry stakeholders and we are trying to formulate a package which should be beneficial to the entire Indian industry and help them in tiding over the crisis,” said Vimal Anand, joint secretary, Department of Commerce, Ministry of Commerce and Industry.

The US administration had in June raised the tariff on steel and aluminium imports to 50 per cent. Speaking at an industry event here, Anand said while India’s direct steel exports to the US remain modest at around 0.1 million tonnes, the high tariffs could impact engineering and auto-component goods, leading to a slump in steel demand.

The tariff escalation could also lead to dumping of excess steel and a drop in prices in the domestic market. “These tariffs could distort trade flows and push surplus steel from other markets into Indian markets, leading to domestic price depression,” Anand said.

Alongside domestic measures, the government is pushing trade negotiations abroad. India is currently finalising terms of reference of the free trade agreements (FTAs) with a few countries, planning to conclude them by year-end.

Anand also said that the trade talks with the European Union (EU) have gathered momentum. “We are already negotiating FTA with the EU and we are trying to complete the negotiation as early as possible,” he said, adding that the EU’s Carbon Border Adjustment Mechanism (CBAM) will be “one of the most important issues” on the table and India will try to get a “soft landing.”

He said within the steel industry, scrap collection is still a mostly informal activity and the latest GST reform will help in formalising the sector. “Since the duty has been reduced, it will give more incentive to the scrap dealers to come into the economy as an organised place,” he said.