According to a memo sent to the government and obtained by Reuters, India’s largest mining sector organisation is asking for increased import levies on metals like zinc, copper, and aluminium to help slow the flow of less expensive imports, particularly from China. The Federation of Indian Mineral Industries (FIMI) stated in a note written to the Ministry of Finance that the government should increase import taxes on a number of aluminium items, including scrap, to 10% from 2.5%. The federation gave Reuters a synopsis of its notes points.
The combined production capacity of India’s aluminium producers is anticipated to increase from its current level of 4.1 million tonnes to 4.6 million tonnes over the course of the next two years. The third-largest producer of primary aluminium in the world is India. India is anticipated to have a 4.2 million-ton aluminium demand in the fiscal year ending in March 2023. In the previous fiscal year, it brought in 2.3 million tonnes of aluminium, the majority of which came from low-cost imports.
The FIMI warned the finance ministry in a note as it worked to create the 2023–24 federal budget, which is scheduled to be unveiled in February, that “the biggest threat of imports is from China, which constitutes over 85% share of downstream aluminium imports.” The United States, United Arab Emirates, Saudi Arabia, and Britain, according to the federation, are the top exporters of metal scrap. Pai cautioned reporters during a post-results media briefing that “we should be careful not to enable the Chinese to dump into India merely because their economy is in crisis.” In addition, the FIMI recommended the government increase import duties on intermediate and final copper and zinc ingot items from 5% to 7.5%.
Following the prohibition on scrap imports into China and Malaysia, the FIMI reported that low-quality copper scraps are now being smuggled in significant numbers by merchants and importers into India. It was stated that India’s primary copper refining capacity of roughly 1 million tonnes was adequate to supply domestic demand. Additionally, according to FIMI, India’s primary zinc production, at 7,00,000 tonnes, is higher than the nation’s consumption, A tax on low-grade iron ore lumps and fines with iron content below 58% was also abolished, according to FIMI. In May, the tax was increased from 0% to 50%.