India’s Aluminium Trade Groups Again Call Upon Government To Implement Safeguards

India’s Aluminium Trade Groups Again Call Upon Government To Implement Safeguards

With the finer details of next fiscal year’s budget being ironed out, India’s aluminium sector again took up its call to increase import duties on primary, scrap, and downstream aluminium, and rationalization of aluminium production input costs.

The Federation of Indian Chambers of Commerce and Industry (FICCI) and the Aluminium Association of India (AAI) have both in recent days approached the country’s government to inform it that the sector continues to struggle against shrinking market share, increasing imports, and surging overhead and production costs.

More particularly, FICCI Committee on Mining and Minerals co-chair Rahul Sharma said that non-competitive energy costs and severe coal shortages have taken a huge toll upon the sector’s sustainability. In a press release distributed to domestic media, Sharma noted that the steel industry faced similar issues in the past, but the Indian government successfully addressed such issues with antidumping duties against importers from the People’s Republic of China, safeguard duties on steel imports, and an increase in basic customs duties on steel products.

Though the demand for aluminium is expected to double to over 7 million metric tons over the coming five years, it has not received the kind of support from the government enjoyed by its sister smelters in the steel industry, he noted. The last few years has seen the steel sector receive significant support from the government, with steel imported into India falling by over one-fifth over the preceding three years.

Meanwhile, increasing protectionist measures by China, the United States, and other major markets has made India a dumping ground for cheap aluminium almost by default, notes Sharma. Such a situation makes a sector already teetering on the brink even more vulnerable.

“Hence, immediate measures like increased import duty on primary aluminum, scrap and downstream aluminium products are required along with rationalisation of input costs of critical raw material of aluminium value chain to help domestic industry retain competitiveness,” counseled Sharma.

In a recent press release issued by AAI, the organization noted the sector was of significant importance to a wide swath of other domestic industries. However, ballooning costs of raw materials, energy, and other inputs over the past three years has allowed Indian smelters’ competitiveness to slip over that time.