Engineering Export Promotion Council India on behalf of engineering exporters has written to the government requesting to include various steel and aluminum products manufactured especially by micro, medium and small enterprises (MSME) in the ongoing negotiations with the US for a bilateral trade agreement (BTA).
They also seek government intervention to ensure the status quo in terms of both quota and the out-of-quota tariffs while negotiating a free trade agreement (FTA) with the European Union (EU) is maintained.
"The 50% tariff imposition by the US increases the tariff differential with our competitors to an average of 30%. This definitely impacts our position in the US market. A special support package that can absorb at least 15% of this differential would help us to secure our position," said Pankaj Chadha, Chairman of EEPC.
On May 30, Trump announced that the existing 25% tariffs on steel and aluminium imports will be doubled from June 4. This hike comes under Section 232 of the US Trade Expansion Act of 1962, a law that allows the president to impose tariffs or other trade restrictions if imports are deemed a threat to national security. The total engineering goods exports to the US, the largest market, declined 9.4% year-on-year to US$1.40 billion in September 2025 as compared to US$1.55 billion in September 2024. India had previously issued a formal notice at the World Trade Organization signaling its intention to impose retaliatory tariffs on US goods in response to the earlier steel tariffs.
Additionally, EEPC highlighted that the new EU proposal on reducing quotas and increasing out-of-quota tariffs to 50% is also becoming a cause of concern. Regarding the pressing concerns of the industry about the EU tariff rate quota (TRQ), the EEPC India chairman has sought exemption for stainless-steel long products (Categories 14, 15, and 22) from TRQs, given their MSME dominance and strategic importance. For other product categories, the Engineering Exports Promotion Council has suggested increasing the quota volumes.
"It may be ensured that out-of-quota tariffs do not exceed 25%, and the same is gradually phased out over five to six years, especially considering the ongoing FTA negotiations with the EU," Chadha said. He urged the negotiating team for the India-EU FTA to take up these issues with EU authorities to ensure enhanced market access for Indian exporters in this important region.