India is seeking to diversify its steel export markets toward the Middle East and Asia after the European Union’s Carbon Border Adjustment Mechanism (CBAM) began imposing a carbon tax on imports in January, reducing the attractiveness of European demand. Europe had accounted for nearly two-thirds of Indian steel exports, but the added carbon costs have squeezed margins, prompting Indian policymakers to pursue new trade opportunities in regions with rising infrastructure investment and steel consumption.
In parallel, New Delhi is intensifying efforts to secure critical raw materials such as coking coal, limestone and manganese through long-term supply agreements and overseas asset acquisitions in countries including Brazil, Argentina, Australia and partners in the Middle East. State-owned firms like the Steel Authority of India and NMDC are actively evaluating these options to cut import dependence, strengthen supply chains and improve resilience amid shifting global trade and climate policies.
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