India, the world's second-biggest crude steel producer, is cooking up plans to keep an import tariff on certain steel products. This tariff, also called a safeguard duty, aims to block cheap steel flooding in, especially from China. Back in August, India recommended a three-year import tariff at a spicy rate of 11%-12% on some steel items. This was done after a careful look by the Directorate General of Trade Remedies. A source with direct knowledge told Reuters, "It (tariff) is under consideration," but asked to stay anonymous because the topic is sensitive. Earlier this year, the government had slapped a 12% temporary tariff for 200 days. That has just expired. India's finished steel imports dropped by a dramatic 34.1% during the first seven months of the financial year compared to last year. South Korea was the biggest supplier, sending 1.4 million metric tons of finished steel to India, followed by China, Japan, and Russia. The source noted China’s inexpensive steel exports made India "vulnerable," hinting at the main reason for tough action. Meanwhile, China’s steel output is shaking things up. For the first time in six years, China's steel production will fall below 1 billion tons this year, as per their state-backed steel association. This is in line with Beijing’s promise to lower steel production and tackle the issue of too much supply. Beijing surprised the market in late October by proposing a stricter steel capacity swap plan. This scheme aims to reduce old steel capacity and better balance supply and demand. Will India extend its protective tariff to guard its mighty steel industry from the rising tide of cheap imports? The answer is still brewing as the government weighs its options.