The recovery is helpful to Indian steel companies burdened with high debt and low margins.

Indian operations of Tata Steel, which is divesting itself of money-losing operations in the U.K., recorded 8% growth in crude steel production to 2.5 million tons for the April-June quarter, with sales up 6% at 2.35 million tons. Automotive steel production hit a record 379,000 tons, the company said.

Integrated steel producer Essar Steel India reported 48% growth in flat-steel production in the first quarter at 1.22 million tons, compared with 824,000 tons in the same period last year. Pellet production grew 58%, from 1.28 million tons to 2.02 million tons.

Essar Steel believes that the upturn since March is due to minimum import pricing introduced for steel in February and quality controls applied by the Bureau of Indian Standards.

The improved volumes pushed Essar's operating margin to around 20% from 5%, which translates to an improvement of 6,000 rupees to 7,000 rupees per ton. "Following these measures by the Government of India, Chinese imports of steel at predatory prices [have] been contained, leading to better sales realization in the Indian market," Essar said.

JSW Steel has not yet released June production figures but registered 16% growth in crude steel output to 1.35 million tons in May. Demand for flat and long products grew 7% and 22% on the year.

Indian steelmakers had been lobbying against cheap imports, particularly from economically ailing China. India's iron and steel industry owes an estimated 3 trillion rupees ($44.4 billion) to banks. Tata Steel alone carries $12 billion in debt as a result of its outright purchase in 2007 of all of Corus Group's steel operations in Europe, the global economic slowdown, and cheap steel imports in Europe, particularly from China.

In February, Prime Minister Narendra Modi's government imposed minimum import prices ranging from $341 to $752 per ton for 173 types of steel. There is talk of extending them beyond August, when they are due to expire.

Other anti-dumping measures were imposed last year to regulate imports from such countries as China, South Korea and Japan. India's inbound steel shipments fell 34.2% to 654,000 tons in April from 994,000 tons in March, according to the latest official data. Steel imports rose 29% in the nine months ended December, which preceded the curbs.