MRAI Raises Opposition to Proposed Hike in Aluminum Import Duty

SEATTLE (Scrap Monster): The Material Recycling Association of India (MRAI) has opposed the government’s move to lift import duty on aluminum. It must be noted that the Commerce Ministry under the Government of India had expressed support to the proposal to raise import duty on both primary and secondary aluminum.

In a letter addressed to Suresh Prabhu, Minister of Commerce and Industry, the Association noted that the country is currently not in a position to do away with aluminum imports. Aluminum scrap is an essential raw material in the manufacture of several critical auto components. The replacement of scrap with primary aluminum will result in up to 40% hike in cost of components, which in turn will elevate the overall production costs of the auto sector, said Sanjay Mehta, President, MRAI.

According to MRAI, the import duty hike is likely to impact several hundreds of medium, small and medium enterprises (MSMEs) and small and medium enterprises (SMEs) in the country and result in loss of approximately 2.5 million jobs.

Meantime, the Aluminum Association of India (AAI), which represents primary aluminum producers in the country, stated that any decision to hike import duty is bound to have serious negative impacts on a section the industry. However, AAI left the decision to the government.

Currently, import of scrap aluminum attracts a duty of 2.5%, whereas the imports of primary aluminum ingots are charged duty of 7.5%. The Commerce Ministry had stated that it is in favor of raising the import duty on both ingots and scrap to 10%.