Union Finance Minister Nirmala Sitharaman on Monday called for multilateral action to address global steel overcapacity, arguing that unilateral tariffs merely shift surplus production between markets.
“Successful unilateral tariffs merely redirect surplus steel from one market to another. A lasting correction of global excess capacity requires multilateral disciplines on the subsidies that sustain uneconomic plans, supported by transparent data,” Sitharaman said while addressing the World Steel Association’s (worldsteel) General Assembly in New Delhi.
Sitharaman also invited worldsteel to consider setting up an office in India. She said India had become the single largest source of growth in global steel demand, strengthening the case for a greater presence of the industry association in the country.
“worldsteel opened its Beijing office in 2006, when China accounted for most of the growth in global steel demand. On worldsteel’s own projections, India is now the largest single source of that growth. As worldsteel enters its 60th year, I invite the association to consider establishing an office in India,” she said.
worldsteel is one of the world’s largest industry associations, with members in every major steel-producing country. It represents steel producers, national and regional steel industry associations, and steel research institutes. Its members account for around 85 per cent of global steel production.
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She said an Indian office would bring worldsteel “closer to the fast-growing steel markets in South Asia, Southeast Asia, West Asia, and Africa, as our commercial ties with these regions are longstanding”.
She said tariffs on steel in some of the largest import markets now reach 50 per cent, while the European Union’s Carbon Border Adjustment Mechanism has entered its definitive phase. Sitharaman added that these developments underscored the need for the global steel industry to expand where genuine demand exists, address structural capacity imbalances, secure supply chains, and reduce emissions.
Recently, India and 13 other economies signed a joint statement at the Group of Twenty (G20) Trade Ministerial in the US, acknowledging that structural excess capacity in sectors such as steel, battery, and chemical poses challenges for trading partners.
Structural overcapacity, particularly in steel, was one of four issues flagged by Washington for the ministerial, alongside the weaponisation of food, the most-favoured nation principle, and forced labour in global supply chains.
At the meeting, the Global Forum on Steel Excess Capacity also agreed on a joint framework calling for greater use of tariffs and reduced subsidies to address overcapacity.
She said India’s steel capacity expansion was being driven by rising domestic consumption. “India has no structural excess capacity in the G20-identified sectors, and its capacity additions are responding to consumption that has outpaced production,” she said.