Steel's Silent Crossing: India Strengthens Iceland Trade Ties

Iceland imports more than $6.1 million worth of iron and non-alloy steel bars and rods annually. Yet the competitive landscape tells a story of Indian dominance so complete it reshapes how global steel markets function.

India holds 86.8% of this Nordic market, commanding the top position with $5.4 million in shipments. The nearest competitor, China, trails with a mere 6% market share at $372,672. This represents a competitive gulf so wide that India's exports exceed the combined shipments of all other suppliers.

The Chasing Pack Falls Further Behind

The competitive hierarchy reveals India's systematic capture of Iceland's steel requirements. The Netherlands occupies third position with 4.5% market share ($280,294), followed by Italy at 1% ($62,942) and Germany at 0.7% ($41,912). Together, these traditional European suppliers account for less than 7% of Iceland's steel imports.

France, Taiwan, Denmark, Slovenia and Romania complete the supplier list, each claiming fragments of what remains after India's dominance. These five countries collectively hold just 0.9% of the market.

The year-on-year comparison exposes how India has not merely maintained its position but expanded control. In the prior year, India supplied $5.38 million, suggesting stable command of Iceland's steel requirements while competitors shuffled for minor positions.

TEPA Strengthens India's Competitive Edge

The Trade and Economic Partnership Agreement between India and the European Free Trade Association, which took effect on October 1, 2025, provides Indian steelmakers with enhanced competitive advantages. EFTA's market access offer covers 92.2% of tariff lines, accounting for 99.6% of India's exports, including full coverage of non-agricultural products.

"The agreement brings together India and a group of advanced European economies in a framework that supports trade, investment, services, technology collaboration and long-term industrial growth."

The Agreement strengthens India's export presence in high purchasing power markets securing binding commitments across pharmaceuticals, textiles and garments, engineering goods, chemicals, processed foods and marine products. For steel exporters, this translates to reduced compliance costs and streamlined market access that competitors outside EFTA lack.

Indian Steel Giants Claim Nordic Territory

The companies driving India's steel dominance in Iceland represent the sector's most established manufacturers. Tata Steel ranked 8th globally in crude steel production in 2024, with domestic crude steel production of 21.6 million tonnes, making it one of the largest steel producers in India. The company exports 25% of its production to Southeast Asia, Europe, and the Middle East.

JSW Steel, one of India's largest private sector steel companies, maintains strong export presence and plans to expand production from 35.7 MT to 51.5 MT by FY31, with operations reshaping world steel leadership. SAIL manufactures structurals, TMT bars, galvanised products, wire rods, plates, railway products, wheels and axles, hot & cold rolled products, pipes, and more.

India's top five exported products in FY26 include bars & rods among GP/GC sheets and coils, HR coils/strips, and pipes, positioning these manufacturers to capitalize on Iceland's import requirements.

Jobs and Livelihoods Across Indian Steel Corridors

This $5.4 million export flow supports an estimated 270 direct jobs and 675 indirect jobs across India's steel manufacturing ecosystem, based on sector employment multipliers of 2 and 5 per $100,000 respectively. The production originates primarily from established steel clusters in Jamshedpur, Jharkhand and Rourkela, Odisha.

In Jamshedpur, Tata Steel's historic plant, established in 1907, employed approximately 40,000 people by 1970 and led to the city's development as India's first industrial city. The facility continues supporting families whose livelihoods depend on steel production for international markets including Nordic countries.

Approximately 40% of this trade involves MSMEs, creating opportunities for smaller manufacturers to participate in international supply chains. However, women represent just 8% of employment in the steel sector, highlighting ongoing challenges in workforce diversity within India's metal production industries.

The Odisha steel corridor, anchored by facilities in Rourkela, connects thousands of workers to global demand patterns. These communities depend on steady export orders to maintain employment stability, making Iceland's consistent import requirements valuable for long-term economic security.

Forward Trajectory in Nordic Steel

India's domestic steel demand is estimated to grow by 9-10% in 2025, while the country ranks as the world's second-largest producer of steel and is poised to overtake China as the world's second-largest consumer. This domestic strength provides the foundation for sustained export capabilities to markets like Iceland.

India's Ministry of Steel launched the third round of the PLI Scheme for Specialty Steel in November 2025, offering incentives of 4% to 15% on incremental sales to broaden high-end steel capacity. These policy measures position Indian manufacturers to maintain competitive advantages in specialized steel products that Nordic markets require.

The TEPA framework creates additional momentum, as EFTA States committed to increasing FDI from their investors into India by $50 billion within 10 years, with an additional $50 billion in the succeeding 5 years. This investment pathway strengthens bilateral trade relationships and reinforces India's position as Iceland's dominant steel supplier.

Data source: Hagstofa Islands (Statistics Iceland), 2025