In a significant move to shield its domestic steel sector, the Indian government has announced a provisional anti-dumping duty on imports of a crucial raw material from six countries. This action targets low-ash metallurgical coke coming from Australia, China, Colombia, Indonesia, Japan, and Russia.
Details of the Duty and Investigation
The decision, notified by the finance ministry on Wednesday, follows a preliminary investigation by the Directorate General of Trade Remedies (DGTR). The probe concluded that these nations were exporting the material to India at dumped prices, causing material injury to domestic producers. The duty is intended as an interim measure to prevent further harm while the investigation continues.
The provisional duty will be effective for six months, from 31 December 2025 to 30 June 2026, unless revoked earlier. The duty amounts vary by country:
- China: $130.66 per metric tonne
- Colombia: $119.51 per tonne
- Russia: $85.12 per tonne
- Indonesia: $82.75 per tonne
- Australia: $73.55 per tonne
- Japan: $60.87 per tonne
The duty applies regardless of whether shipments are direct or routed through third countries. It must be paid in Indian currency based on the exchange rate on the bill of entry date.
Critical Input for Steel and Policy Contradiction
Low-ash metallurgical coke is essential for blast furnace-based steelmaking, which forms the backbone of India's steel production. It provides the necessary heat and chemical reaction to convert iron ore into molten iron and maintains the blast furnace's structure.
However, this protective measure has sparked criticism from trade experts who point to a policy contradiction. Ajay Srivastava, founder of the Global Trade Research Initiative (GTRI), argues that while the government protects finished steel with duties and quality orders, restricting key inputs like metcoke raises costs and hurts the competitiveness of the very industry it aims to shield.
"This policy contradiction is raising production costs, weakening competitiveness and ultimately hurting the very domestic producers it seeks to protect," Srivastava stated.
Immediate Impact and Broader Consequences
The expert highlighted that the impact is already being felt. In the first half of 2025, steelmakers secured only about 1.5 million tonnes against a demand of over 3 million tonnes, forcing reliance on uneven domestic supply and risking production cuts.
Given that this coke accounts for roughly 38% of finished steel costs, a 20-25% price hike in coke can increase steel prices by 3-5%, squeezing margins. Srivastava warned that stacking duties on a non-substitutable input risks over-correction and broader macroeconomic consequences, advocating for a more calibrated approach to support growth and productivity.
This new duty comes shortly after India extended the safeguard duty on certain steel imports until April 2028, indicating a continued focus on protecting the domestic metals industry from cheap imports.
