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  • Indian Aluminium biggies underline their faith on India as the biggest aluminium demand driver in the making


    India is at the threshold of emerging as the next biggest demand driver for aluminium- the strategic metal of tomorrow. Although, presently, the per capita consumption of the metal here stands at 2.2 kg against the world average of 8.4 kg, rapid urbanisation, improving automobile story of the country, and increasing GDP rate- indicate at a future where the use of aluminium has grown significantly. Countries which are now competing with India at the production front will then try to grab of a piece of this lucrative market. China, for instance, is already doing so. There the GDP rate has started declining and the demand for industrial metals like aluminium has shrunk considerably.

    Satish Pai, Deputy Managing Director of Hindalco Industries Ltd., sounded positive when he said this at the national seminar - 'Aluminium - The Strategic Metal' – in Bhubaneshwar, organised by Aluminium Association of India (AAI) on 30th June, last Thursday.

    Mr. Pai said Indian aluminium industry should start making more investments in the downstream sector now, as increase in the downstream production was critical for meeting India’s growing aluminium demand, which is presently met through mainly imports.

    He cited the example of Hirakud Rolling Plant, which, built at a total cost of INR 1500 crore, produces the most advanced cold rolling flat rolled products in the country.

    He also highlighted the fact that Indian downstream aluminium sector had all the potential of becoming a prime employment generator of the country. So, for the sake of the economy, it was important that the industry is taken good care of in the face of onslaught of cheap imports and dumping.

    Mr. Pai’s views found support in AAI President and Nalco CMD T.K. Chand’s speech who said, there is enough scope of growth for aluminium consumption in India and concerted effort should be made to further promote the use of the metal in various end user sectors.

    However, the industry is currently faced by a number of challenges. Rising coal prices and logistics cost related to bauxite transport are adding to the cost of production of aluminium, which is eventually rendering the industry uncompetitive in comparison to Middle East and other countries, where they get to save around 50% on CoP.

    “AAI will be deliberating the issues faced by Indian aluminium industry,” Mr. Chand said. But he added the ministry should also consider constituting the Aluminium Development Council of India, so that both AAI and the newly formed body can jointly work on an action plan to meet these challenges.

    He also advocated for making Odisha the Aluminium Capital of India since the state contributes around 72% of total aluminium production in the country.

    Reacting to AAI’s demand, secretary to the ministry of mines Balvinder Kumar said, “It is a genuine and good demand (to set up the council). We will set up the Aluminium Development Council soon.”

    Recognizing the fact that ‘there is a tremendous scope for development of the aluminium sector in the country’, he said, "We are taking measures to mitigate them. However, we have to take balanced and considerate views.”

    On AAI's demand of treating alumina at par with lime stone in regard to railway freight charges, Kumar said, "We will write to the ministry of railways. We support the demands of AAI in this regard."

    He also supported Mr. Chand’s appeal on recognising Odisha as the aluminium capita of India.

    Mr. Abhijit Pati, Chief Executive Officer (Aluminium) of Vedanta Ltd. talked about raising aluminium production jointly by the company's smelters at Jharsuguda in Odisha and Korba in Chhattisgarh. However, he reiterated the need of urgent bauxite supply to realize the plans.

    "We plan to enhance production in Lanjigarh refinery from 1 million tonne per annum to 1.5 mtpa, a 50 per cent increase. It will help in raising overall aluminium output."

    He said that uninterrupted bauxite supply will also play a significant role in putting in full steam the second smelting unit as well as the proposed aluminium park at Jharsuguda.

    Stating that efforts at smelting capacity ramping up at Jharsuguda has received a boost following permission to utilise three units of the 2400 mw (3x600 mw) power plant there for captive use.

    If Vedanta plants are able to run at full capacity, it would facilitate the proposed downstream aluminium park at Jharsuguda, which can attract investment of at least Rs 1,000 crore and provide direct and indirect employment to around 17,000 people, he said.

    The national seminar on aluminium was a success. The discussions held at the event in presence of all the industry glitterati, primary producers and more than 200 downstream and secondary producers of the country, helped upholding the issues that matter the most for the industry at the moment.

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