India Government to enforce Quality Control orders on aluminium sales

According to a recent report, India Government is bringing off Quality Control (QC) orders issued by the Ministry of Mines to contain poor-quality aluminium, copper, and nickel sales from December 2023. This measure will leave no choice for sellers but to offer those metals whose ratings are in line with the recommendations of the Bureau of Indian Standards (BIS).

Jayanta Roy, Senior Vice President at ICRA Limited, said: “The proposed quality control order will lead to the elimination of sub-grade material imports, if any, which can potentially lead to a shortage of raw material for downstream producers, resulting in a hardening of product prices in the domestic market in the near term.”

In March 2023, The Ministry, in consultation with the Bureau of Indian Standard (BIS), notified about the Quality Control orders through its website and sought comments and feedback on the draft till May. The Ministry found that more than 40 per cent of India’s aluminium consumption was met by imports in the form of alloy scrap. The entire nickel requirement of the country came from overseas, and roughly half of India’s copper demand was catered by imports.

However, the industries’ people believe that implementing Quality Control orders will result in raw material supply disruptions for the downstream sector as it will restrict imports and lead to the formation of price cartels among companies that possess QC certification.