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US Commerce Secretary Howard Lutnick on Monday credited President Donald Trump's steel tariffs with driving Indian conglomerate Essar Group's plans to build a USD 15 billion integrated steel complex in Iowa, saying the project would not have happened without the duties. Last year, Trump raised tariffs on imported steel to 50 per cent as part of his push to boost US manufacturing.
"So these are your 232 tariffs, the steel tariffs at work. Without those tariffs, this mine and steel plant doesn't get built," Lutnick said, pointing to the investment by Essar-owned Mesabi Metallics.
Lutnick's remarks come against the backdrop of his repeated criticism of India's tariff regime. He has previously said New Delhi has “some of the highest tariffs in the world” and argued that India's high import duties restrict access for US goods and need to be reduced for a broader trade agreement.
Currently, the India-US trade deal is close to finalisation, with a senior US official saying last week that the two sides were “90-per-cent-plus” there and had only a few issues left to resolve.
In his remarks, Lutnick said the Essar project would help reduce the US's dependence on imported steelmaking inputs, particularly iron ore pellets. The US currently gets a significant share of its pellets from Brazil, Lutnick said, arguing that relying on overseas supplies leaves American steelmaking dependent on foreign inputs.
"Now we are unleashing the Iron Range in Minnesota," the Commerce Secretary said, referring to the Mesabi Iron Range, before highlighting the planned steel plant in Iowa.
"You go right down the Mississippi to Iowa, where they get to build a USD 15-billion integrated steel plant. This is exactly your plan, because you're driving steel to America," he said.
ESSAR'S MASSIVE STEEL PLANT INVESTMENT
Trump unveiled the Iowa project at the White House alongside executives of Mesabi Metallics, describing it as a major boost for American manufacturing. The White House has called it the largest steel plant in US history. The project is part of Essar Group's wider US investment plans.
Essar Chairman Rewant Ruia thanked Trump for supporting efforts to expand manufacturing and said the Iowa complex would help complete a fully integrated American supply chain.
Mesabi Metallics plans to use iron ore extracted from its mine in Nashwauk, Minnesota, and transport it to Iowa for steel production. The company has invested more than USD 2.5 billion in developing the Minnesota mine, which Trump described as the first new iron ore mine in the US in more than 50 years.
The first phase of the Iowa plant is expected to produce 7.5 million tonnes of steel annually, with capacity potentially rising to 10 million tonnes. First steel production is targeted for 2030. The plant is expected to create at least 1,750 permanent jobs, while the first phase could generate another 5,000 to 6,000 construction jobs.
Trump has made steel tariffs a central part of his push to revive US manufacturing. The administration has raised tariffs on imported steel to 50 per cent, arguing that higher duties encourage companies to build production facilities in the US rather than import steel.
The Essar project in the US, therefore, gives the administration a prominent example to cite as evidence of its argument that tariffs can encourage investment in domestic steelmaking.
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