Aluminium producers have appealed to the government to increase the import duty on aluminium scrap from the current 2.5% to 7.5% in the upcoming budget. They have also requested that the duty on primary aluminium imports remain unchanged at 7.5%, or be marginally increased to 10%.
This initiative aims to deter the influx of sub-standard materials and protect the domestic industry, which supports the livelihood of over 10 lakh people.
In its representation to the Finance Minister, the Aluminium Association of India has asked the government to control imports by fixing scrap import duty at par with that on primary aluminium, i.e. 7.5%.
AAI has also called for maintaining the duty on primary aluminium imports at the current rate of 7.5% or a marginal rise to 10%, encompassing downstream products as well, in order to protect the domestic market from inundation of cheap imports.
Despite sufficient domestic production, primary aluminium imports continued to rise, registering a 30% increase year-on-year, driven by imports from China and free trade agreements with ASEAN and the Middle East countries. This influx hampers the viability of MSMEs in downstream production as well.
"Imports fulfilled 55% of the country's aluminium demand in FY24, while the share of domestic producers plummeted from 60% in FY11 to 45% in FY24. Alarmingly, low-quality foreign scrap, which poses safety and environmental risks, has spiralled upwards from 472 kt (kilo tonne) in FY11 to 1,768 kt in FY24, which is a whopping increase of 274%," AAI said.
(With inputs from PTI)
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