ICEMA asks govt to re-evaluate long-term implications of steel safeguard duty

New Delhi, Apr 22 (PTI) Indian Construction Equipment Manufacturers’ Association on Tuesday asked the government to re-evaluate long-term implications of the 12 per cent safeguard duty imposed on select steel products saying it is expected to disrupt supply chain and cost structures in the sector.

Steel is the most critical raw material in construction equipment (CE) manufacturing, particularly specialised high-tensile and performance-grade steels that are currently not produced in India at sufficient volumes or specifications, Indian Construction Equipment Manufacturers’ Association (ICEMA) said in a statement.

“As these materials are largely imported, the imposition of the safeguard duty immediately compromises manufacturers’ ability to source essential inputs, threatening both production continuity and the timely delivery of equipment,” it said.

India on Monday imposed a 12 per cent provisional safeguard duty for 200 days on five steel product categories, including hot rolled coils, sheets and plates, to protect domestic players from surge in imports.

The decision followed a recommendation for the same by the Commerce Ministry’s investigation arm DGTR. Last month, the DGTR suggested to impose the duty.

“The CE industry urges the government to urgently re-evaluate the long-term implications of the safeguard duty and consider mitigation measures to cushion the blow to downstream industries,” ICEMA said.

It further said, “A well-balanced, data-driven policy that supports both domestic steelmakers and vital sectors like construction equipment manufacturing is essential to protect India’s infrastructure ambitions and global competitiveness.”

The CE industry body said even prior to the announcement, the mere initiation of the safeguard inquiry had triggered substantial price volatility.

“Steel prices rose by approximately ₹10,000 per tonne during the course of the investigation, squeezing already narrow margins. With the 12 per cent duty now officially imposed, input costs are expected to rise even further, forcing CE manufacturers to consider price hikes that will ultimately impact infrastructure project costs nationwide,” ICEMA said.

The decision also risks undermining India’s export competitiveness in the global construction equipment market, particularly at a time when international buyers are actively seeking alternatives to China under ‘China plus One’ sourcing strategies, it added.

ICEMA cautioned that with rising input costs and reduced flexibility, Indian CE manufacturers may lose momentum in capturing global market share, a setback to the broader goal of establishing India as a global manufacturing hub.