India gets steel export quota to EU under trade deal
India will be allowed to export up to 1.64 million metric tons of steel annually to the European Union under a free trade agreement, though exporters will still need to pay carbon-related costs, according to the legal text of the agreement. The deal gives India an additional preferential quota of 694,853 tons of steel, which ...
India has been granted a steel export quota of up to 1.64 million metric tons annually to the European Union through a free trade agreement, with exporters required to pay carbon-related costs, according to the agreement's legal text. The deal provides India with an extra 694,853 tons of steel quota, in addition to the existing 946,616-ton World Trade Organization quota.
This combined quota makes up approximately 68.4% of India's projected 2.4 million tons of steel exports to the EU in 2025, up from 39.4% under the previous quota. The Indian steel industry has been seeking a 29-35% increase in quotas for various products, as reported by Reuters. However, India's total quota under the agreement is less than its current entitlement, placing the country at a disadvantage in terms of market access, according to a note submitted to the trade ministry.
Steel shipments exceeding the quota will be subject to an EU tariff of 50%, as stated in an analysis of the legal text by India-based think tank Global Trade Research Initiative. The preferential quota does not exempt Indian steel from the EU's Carbon Border Adjustment Mechanism, which will apply to all steel imports. This mechanism is estimated to account for around 35% of the value once fully implemented. The legal text remains subject to revision.
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