Months after US President Donald Trump hiked import tariffs on steel and aluminium, which are likely to indirectly hurt a lot of companies back home, India launched a complaint against the decision at World Trade Organisation, Reuters reported. India’s decision to open a WTO dispute also came nearly two months after the United States challenged Indian export subsidies at the trade forum.
India has also told the WTO that it proposing to raise duties by up to 100% on 20 products such as almonds, apple and specific motorcycles imported from the US from next month if Washington does not roll back high tariffs on certain steel and aluminium items.
In March this year, Donald Trump signed an executive order that provided for imposing import tariffs of 25% on steel and 10% on aluminium. The decision had triggered the fears of a trade war between the US and China. While Indian companies are not directly hit by the tariffs, they are expected to become collateral damages.
Steel and aluminium exports by Indian companies to the US are as low as 2% and 6% respectively. “However, the impact could percolate through lower international prices due to excess supply from exporting countries while also leading to lower exports,” a report by India Ratings and Research said.
Though Indian steel imports would be restricted to specialised products not manufactured in India, a situation of cheap availability of imports may prove as a double whammy, especially against the backdrop of a growing domestic demand of steel, the report added.
India primarily exports steel to Italy, the UAE and South East Asian countries. With export markets becoming more competitive, domestic steel companies may not only lose their market share in the exporting regions but also see the export value declining due to lower global prices of steel and aluminium.