The U.S. reciprocal tariffs are expected to disrupt global trade flows and affect alternative markets like India with increased steel imports from countries hit by President Donald Trump’s import levies, experts said.
President Trump on Wednesday (April 2, 2025) announced reciprocal tariffs on about 60 countries in a historic measure to counter higher duties imposed globally on American products.
For India, the U.S. has announced 27% reciprocal tariffs saying New Delhi imposes high import duties on American goods, as the Donald Trump administration aims to reduce the country’s trade deficit and boost manufacturing.
However, automobiles and auto parts and steel and aluminium articles, already subject to Section 232 tariffs at 25%, announced in March, are not covered in the latest order.
Indian Stainless Steel Development Association (ISSDA) said the overall volume of (stainless steel) exports to the U.S. remains modest, limiting the direct impact of reciprocal tariffs on India’s stainless steel sector.
“The greater concern, however, lies in the potential trade diversions triggered by such policies. Countries facing U.S. tariffs may redirect their exports to India, leading to an influx of low-cost imports,” ISSDA President Rajamani Krishnamurti said.
This poses a significant challenge to domestic producers, threatening the sustainability and growth of the Indian stainless steel industry, he said.
Dhruv Goel, CEO of market research firm said, “The indirect impact could be significant. Any disruption in global trade flows can lead to price volatility, shifts in demand-supply dynamics, and increased competition in alternate markets.”
According to BigMint, U.S. imports from India (finished steel, semi finished and stainless steel) stood at 0.22 million tonnes in 2024.
In 2024, imports of steel from China to the U.S. were 0.39 million tonnes, 3.06 million tonnes from the EU, 0.75 million tonnes from Japan, 1.19 million tonnes from Vietnam and 2.53 million tonnes from South Korea.
Vinayak Vipul, Partner, Metals and Mining, EY Parthenon said the direct impact will be limited but secondary effects such as global price fluctuations and trade diversions require close monitoring, he said.
Hridaya Mohan, ED at SAIL, said that with the exports from the EU to the U.S. becoming unviable, India may face steel dumping from China, South Korea, and Japan.
Ram Aggarwal, CEO, special steel maker Goodluck India said the U.S. tariffs are expected to adversely impact Indian exporters, particularly in the steel tube category.
Ritabrata Ghosh, Vice President & Sector Head, Corporate Ratings, ICRA, said, “Steel was already under the 25% duty imposed under Section 232 and the latest reciprocal tariff announcement exempts steel. The immediate impact could be limited.” Jindal Stainless MD Abhyuday Jindal said, “The development is bound to affect the global supply chain order, and the Indian industry, especially manufacturing, could benefit from this.”
“The lower reciprocal tariff rate of 27% on Indian goods, compared to much higher rates on China and Southeast Asian countries, could open up an array of opportunities in other sectors due to recalibrated trade flows. India Inc and MSMEs, supported by favourable policy measures, can take this opportunity to fill these gaps.”
