An article published with the Reserve Bank of India’s October bulletin flagged the issue of vulnerability of India’s steel industry from competitive pricing by major steel-producing countries and “increased imports”. While this and the emphasis in the article on the need to increase the competitiveness of India’s steel sector are relevant, imports have actually seen a decline in recent months.
There was a 29% fall in steel imports in the first half of the current fiscal year owing to various tariff and non-tariff barriers.
To be sure, imports remain uncompetitive now, with domestic steel priced at a discount of 7,000-8,000 per tonne to imported material.
Local steel prices have slumped to a five-year low, trading in the range of Rs 47,000-48,000 per tonne for hot rolled coil, as per BigMint.
However, with exports being difficult on account of competitive pricing by countries like China in the world markets, especially after the fresh US tariff on steel, India still has remained a net importer of steel for several months now. September was the sixth consecutive month India remained a net steel importer.
The situation has created uneasiness in the steel sector, especially among the primary steel makers. Lower prices of the alloy might be a temporary boon for downstream steel users including automobile and white goods makers and railways. However, the question is whether the current prices are remunerative for the primary steel makers, who have large capacity addition plans.
The steel ministry is scheduled to hold an “open house” early next week to discuss steel import-related matters, in which steel firms and industry associations have been invited to share their views.
The RBI bulletin article has also flagged the issue that in recent times, India’s steel sector has been facing challenges due to increased imports and competitive pricing from major steel-producing countries, which was affecting domestic market share, lowering capacity utilisation, and adding pressure on domestic producers.
“The pricing strategies of exporting nations remain a concern for the steel industry. Addressing these challenges calls for a balanced approach, including policy support and initiatives to enhance the competitiveness of India’s steel production through innovation, cost efficiency, and sustainable practices,” the article suggested.
While recent data on imports do not corroborate these concerns, from a medium to long-term perspective, the issues raised are valid, analysts said.
Imports of finished steel in the first half of the current fiscal year stood at 3.3 million tonnes (MT), down 29% year-on-year, while exports increased by 22% to 2.8 MT. The imported material came from both FTA and non-FTA countries, including China, Japan, and Vietnam. The US’s imposition of new tariffs on steel imports also increased the threat of dumping by other countries.
The government’s multiple protectionist measures, including safeguard and anti-dumping duties, stringent Bureau of Indian Standards (BIS) certification norms, and restricted licence renewals, have made imports costlier.
The landed cost of imported HRC is around ₹56,000 per tonne, compared with ₹48,000–49,000 per tonne for domestic material, keeping Indian mills price-competitive.
An analyst with BigMint said, “In the near term, India’s steel import volume is expected to stay subdued as trade barriers and quality checks continue to keep import economics unviable. Domestic mills are likely to maintain their competitive edge, supported by stable demand and government policy measures aimed at ensuring self-reliance and market stability.”
The primary steelmakers’ profitability hadn’t seen a big decline until the April-June 2025 quarter (see chart). However, JSW Steel has reported a sequentia decline in profit from Rs 2,178 crore in Q1 FY26 to Rs 1,493 crore in Q2, indicating the effect of subdued prices.
Currently, India’s steel manufacturing capacity is 200 million tonne (mt), wth the National Steel Policy targetting to raise it to 300 mt by 2030. Most of the large players like SAIL, Tata Steel, Jindal Steel have massive capacity addition plans in tune with the policy. India’ massive infrastructure upgrade, industrial expansion and consumption base implies a big spike in per capita consumption of steel from just 98 kg now, as against the world average of 221 kg and China’s 635 kg. The export market for steel must also be an incentive for Indian steel units given the availability of iron ore in large quantities in the country and overall cost competitiveness that can be acquired with further reduction in logistics costs.
