In a bid to support domestic players, the government is mulling a proposal to increase import duties on aluminium scrap and primary aluminium. The industry has demanded for the same amid a high growth in inwards shipments of these items. Presently, the basic customs duty on primary aluminium is 7.5 percent while the same on aluminium scrap is 2.5 percent.
The Aluminium Association of India (AAI) has also urged the government to increase the duty on imports of aluminium scrap as the domestic sector may become a victim of escalating trade war between the US and China. It said that an estimated 30 percent of China's aluminium scrap imports come from the US. It noted that aluminium is required by industries like automobile, construction, consumer goods, etc. and all these industries are growing in India and the country is producing sufficient amount of required metal domestically.
Total production of aluminium in India is about 4 million tonnes and consumption is around 3.6 million tonnes. The demand comes in the wake of the US imposing 10 percent duty on certain aluminium products. China, too, has raised the duties. As per estimates, during Q1 (April-June) of 2018-19, imports of aluminium scrap increased to 36,000 tonnes from 16,000 tonnes.