India Joins WTO Challenge to UK Steel Curbs

India, China and Japan have joined other World Trade Organization members, including Korea, Switzerland, Russia and Brazil, in criticising the United Kingdom’s steel safeguard measures. The UK measures use tariff-rate quotas and a 25% tariff on imports above quota limits, and they were introduced in response to global steel overcapacity and the United States Section 232 tariffs of 2018.

WTO Safeguard Measures on Steel

A safeguard measure is a trade remedy under WTO rules that allows a member to restrict imports temporarily when domestic industry faces serious injury from a surge in imports. The UK applied safeguards to 15 categories of steel products, and the measure was later extended on the basis of recommendations from the Trade Remedies Authority.

UK Steel Quotas and Tariff Structure

The UK steel safeguard originally followed the European Union’s response to import pressure in 2018. The system used tariff-rate quotas, under which imports within the quota entered at a lower duty and imports beyond the quota faced a 25% tariff. In June 2022, the UK government accepted a recommendation to extend the safeguard on all 15 steel categories until 30 June 2024. The measure was then extended to 30 June 2026, and the UK has stated that the safeguard cannot continue beyond that date under WTO rules.

India-UK Free Trade Agreement and Steel Trade

The new UK steel import restrictions, effective from July 2026, have affected the operationalisation of the India-UK Comprehensive Economic and Trade Agreement. The revised UK regime is set to reduce tariff-free steel import quotas by nearly 60% and raise the penalty tariff to 50% once quota limits are crossed. India’s iron and steel product exports to the UK were about US$893.4 million in 2025-26. India and the UK have discussed a unique and creative solution to address the steel dispute, which was not included in the original CETA negotiations.

Important Facts for Exams

• The World Trade Organization permits safeguard measures under specific conditions for temporary import restriction.
• Tariff-rate quota is a trade system in which imports within a fixed quantity face a lower duty than imports above the limit.
• US Section 232 tariffs on steel and aluminium were imposed in 2018 on national security grounds.
• The Trade Remedies Authority is the United Kingdom body that advises on trade defence measures.

WTO Dispute Context

WTO members often challenge safeguard measures when they consider them inconsistent with multilateral trade rules. Steel is one of the most frequently used products in trade remedy disputes because it is covered by quotas, tariffs and anti-dumping actions in several economies.