Indian Steel and Aluminum Exports Face Uncertainty as US Tariffs Loom

India is negotiating relief from US tariffs on steel and aluminum as trade officials meet for key discussions from March 25-29 in New Delhi. As Trump’s tariffs are set to take effect on April 2, 2025, India seeks exemptions to protect its metal exports, while aluminum and steel producers explore alternative markets.

India is preparing to negotiate an exemption from US reciprocal tariffs as American trade officials arrive for discussions on a bilateral trade agreement. 

According to media reports, Brendan Lynch, the US Assistant Trade Representative for South and Central Asia, will visit India from March 25-29, 2025, along with a delegation of officials as part of ongoing trade negotiations between the two nations.

Reports further indicate that Indian officials in New Delhi plan to push for relief from the reciprocal tariffs scheduled to take effect on April 2. One of the primary concerns in the discussions is the impact of US tariffs on Indian steel and aluminum exports.

Overview of US tariffs on India’s steel and aluminum

India’s steel and aluminum industries have been considerably affected by US tariffs imposed under the Donald Trump administration. In 2018, the US levied global tariffs of 25 percent on steel and 10 percent on aluminum under Section 232 of the Trade Expansion Act, 1962, citing national security concerns. These measures have directly impacted India, one of the key exporters of these metals, and led to retaliatory tariffs on US goods. India is now negotiating for relief from these tariffs, arguing that they negatively impact the country’s steel and aluminum segments’ trade trends.

India’s aluminum industry’s high exposure to US market

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According to the data provided by the Department of Commerce, under the Ministry of Commerce and Industry, India exported US$945.66 million worth of aluminum to the US in FY2023-24, making it the second largest international market for Indian aluminum products. The US accounted for roughly 12 percent of India’s total aluminum exports, with key products including unwrought aluminum, aluminum conductors, nails, fasteners, and wire.

Among these, aluminum conductors—critical for high-voltage transmission and grid modernization projects—have been particularly vulnerable to global trade policy changes. In FY 2023-24, the US imported aluminum conductors, including commodities such as stranded wire, cables, plaited bands, and similar products made of aluminum (but not electrically insulated) with a steel core, worth US$178.99 million.

Source: Department of Commerce, Ministry of Commerce and Industry, GoI.

Despite robust demand that led Indian aluminum shipments to the US to grow even after 2018 tariff hikes, the broader scope of the latest tariffs announced by Trump in February 2025 could impact Indian manufacturers and exporters.

With the 2025 tariff decision of the US, covering a wider range of aluminum products, Indian exporters face challenges in maintaining their foothold in the American market. Industry analysts predict a decline in export volumes and lower realization per ton of aluminum sold. The tariff surge could force Indian exporters to shift their focus to alternative markets in Europe and Southeast Asia, where demand remains robust.

US tariff impact on India’s steel industry

Unlike aluminum, India’s steel sector is less dependent on the US market. In FY2023-24, the US imported 100,000 metric tons of Indian steel, a small fraction compared to India’s total production of 145 million metric tons. Earlier in March 2025, steel secretary Sandeep Poundrik said that the impact of US tariffs on India’s steel sector will be minimal due to strong domestic demand.

However, on February 10, 2025, the Indian Steel Association (ISA) warned that an 85 percent drop in steel exports to the US could lead to an oversupply of the commodities in the domestic market, affecting prices.

India’s steelmakers are reportedly shifting their attention to other international markets, particularly in Europe and the Middle East, to counter any anticipated losses caused by the US trade restrictions.

Trade barriers and global market challenges

A network of complex trade relations is increasing worldwide, with multiple countries imposing tariffs to safeguard their domestic industries. The European Union (EU) has introduced anti-dumping duties of up to 25.30 percent on cold and hot-rolled stainless steel and a 25 percent safeguard tariff on imports exceeding set quotas. Countries such as the US, Brazil, and Mexico have similarly imposed high duties on steel and aluminum products.

Asian nations, including Vietnam, Thailand, and Malaysia, have also implemented trade measures targeting steel imports, reflecting growing concerns over excess capacity and competitive pressures in the global metals market. Without strong protective measures, India risks becoming a dumping ground for surplus global steel and aluminum inventory.

Rising inventory levels and falling prices

Despite increased domestic steel production, India has witnessed a surge in steel imports in recent years.

Source: Department of Commerce, Ministry of Commerce and Industry, GoI.
*Iron and steel import data for FY2024-25 is available from April 1, 2024, to December 31, 2024. The complete data will be released by the ministry after March 31, 2025.

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Rising inventory levels indicate that imported steel is displacing locally produced steel, posing a challenge for domestic manufacturers. Additionally, falling international steel prices and an influx of low-cost Chinese steel have put further pressure on Indian steelmakers. Industry stakeholders have urged India’s central government to raise Basic Customs Duty (BCD) on steel imports, particularly from China, to curb excessive imports and support local manufacturers.

Future outlook

To counteract the adverse effects of US tariffs and global market shifts, Indian metal producers are focusing on market diversification, overseas manufacturing, and policy negotiations. By seeking alternative export markets, increasing domestic consumption, and advocating for fair trade policies, India aims to ensure long-term competitiveness in the evolving global trade environment. The ongoing trade discussions with the US delegation are a crucial step toward securing tariff relief and strengthening India’s position as an exporter.

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