The tariff escalation is expected to pressure major Indian metal companies such as Tata Steel, JSW Steel, Hindalco Industries, and NALCO, all of which have substantial exposure to the US market.
The development has significant implications for India’s export-oriented metal sector. As per government data, India exported USD 4.56 billion worth of iron, steel, and aluminium products to the US in FY2025.
The revised tariff structure is expected to directly impact this segment by making Indian products more expensive and less competitive in the U.S. market.
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Of the total USD 4.56 billion in exports, USD 587.5 million came from iron and steel, USD 3.1 billion from articles of iron or steel, and USD 860 million from aluminium and its related products. These products, now subject to sharply increased tariffs, face the risk of reduced demand in one of India’s key export destinations.
The tariff hike was formally announced on May 30, 2025, under Section 232 of the U.S. Trade Expansion Act of 1962, which allows the American President to impose trade restrictions if imports are deemed a threat to national security.
The move revives the trade policy provision first used by Trump in 2018 to impose a 25% tariff on steel and 10% on aluminium, which were then increased to 25% across both categories earlier in February 2025.
As a result of the latest tariff action, US steel prices are expected to surge beyond USD 1,180 per tonne, driving up input costs for several downstream industries, including automotive, construction, and manufacturing. India has already raised a notice at the World Trade Organization (WTO) in response to the decision and may consider further action.
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