Indian steel-makers exporting to the EU are bracing for probable reduced market access, which could lead to significant financial hit, and increased competition on account of tightened safeguard measures.

There will also be less flexibility, for India, to utilise unused quota volumes from other countries.

The EU, amongst the largest finished steel export markets for India, has introduced significant amendments to its safeguard measures, effective April 1. One out of every three metal shipment exports from India goes to the EU.

The revision comes as the region looks to bring down import of the metal. Some pegging estimates by approximately 15 per cent, so that domestic industries there get a competitive edge.

Retaliatory tariffs by India are under-consideration, said sources.

New Rules

Under the new EU rules, import shipments within the established quotas will remain exempt from tariffs. However, any imports exceeding these limits (called tariff-rate quotas or TRQs) will face a 25 per cent duty.

A key change, European Commission’s decision to abolish the transfer of unused quotas for countries and categories experiencing low consumption.

India’s HRC (hot rolled coils) – the benchmark and most exported item – quota could be reduced. Quotas for plates, wire rods, and hollow sections will also be impacted.

“India’s HRC quota will be reduced by approximately 25 per cent. Quotas for plates, wires rods and hollow sections will also be impacted,” market intelligence firm, BigMint said in a recent report.

Quotas Gone

For instance, in certain HRC segments, India for July 2025-June 2026 face no access to residual quotas, and 35 per cent of sanctioned volumes (previously redistributed from Russia/Belarus) are no longer available. This means, India’s export ceiling is reduced.

In wire rod, there will be restricted quota accesses limit.

In case of rebars, wth 82.3 per cent TRQ usage and no residual access, Indian exporters face tighter limits, impacting shipments to construction-heavy EU markets.

As per India’s Steel Ministry, Italy, Belgium and Spain are amongst the three major European markets, accounting for close to 35 per cent of total exports of 4.4 million tonnes. However, shipments to all the countries are down 56 per cent, 32 per cent and 37 per cent on an 11MFY25 basis.

Reduced Market Access

The EU safeguard measures impose TRQs on 26 steel product categories, limiting the volume of steel that can be imported duty-free. Once these quotas are exceeded, a 25 per cent out-of-quota duty is applied.

The 2025 review tightens these quotas further by reducing the annual liberalisation rate from 1 per cent to 0.1 per cent and introducing caps on residual quotas.

Indian steelmakers exported $6.64 billion worth of iron and steel products to the EU in FY24, this reduction directly constrains their ability to grow export volumes.

Increased Competition

The European Commission in its findings mention, imports from origins with relevant capacity expansions, including India, remain high.

This implies that India’s growing steel production capacity could lead to increased exports to the EU, potentially straining the EU market further.

Global overcapacity, at 630 million tonnes by 2026, is estimated and surging Chinese exports -110 million tonnes in 2024 – are seen as threats which displace steel from other markets into the EU.

Indian steelmakers face heightened competition from these redirected flows. And squeezes the exporters’ market share, especially in high-demand categories like hot-rolled coils and corrosion-resistant sheets and other segments where TRQ usage rates are high.

“This rigidity forces Indian exporters to either scale back shipments or incur the 25 per cent duty, raising costs,” an exporter told businessline, adding that Carbon Border Adjustment Mechanism (CBAM), effective from January 2026, adds further compliance costs.

The EU has maintained safeguard measures on steel imports since 2019, using TRQs to limit duty-free imports.

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Published on March 31, 2025