India should tap domestic aluminium potential and curb imports in line with self-reliant programme: FIMI

On Friday, August 21, Federation of Indian Mineral Industries (FIMI) said the country should check its aluminium imports and make use of “rich and almost inexhaustible” domestic resources instead, in line with the government’s self-reliant vision.

The domestic aluminium consumption is expected to reach 10 million tonnes in the next ten years (FY2031-32). So, to meet the demand, India needs to ramp-up the production of the metal and also its raw materials. Bauxite production should be targeted to increase from 23 million tonnes in FY19 to approximately 70 million tonnes by FY2031-32, while the output of alumina from 7.4 million tonnes to 20 million tonnes, said FIMI Vice President R L Mohanty at a webinar.

India is "favourably endowed with rich and almost inexhaustible resources of bauxite," which is the main raw material for the production of aluminium, he added.

But despite having sufficient domestic aluminium capacity to meet the indigenous demand, 60 per cent of the country’s total consumption is being imported, resulting in forex outgo, pointed out Mohanty.

India is a leading global player in terms of aluminium production, with second largest output capacity. The country has a primary aluminium capacity of 4.1 million tonnes per year and downstream processing capacity of 3.9 million tonnes, which lays conductive platform for scaling up and leveraging the country’s natural resources, said Mohanty.

He also said that India has already made huge investments of INR 12 lakh crore to enhance domestic production capacity from 2 million tonnes per annum to 4.1 million tonnes per annum for catering to the expected growing demand in the future.

As far as bauxite resources are concerned, most of them are concentrated in the East Coast Bauxite deposits in Odisha and Andhra Pradesh, followed by other states like Madhya Pradesh, Gujrat, Chhattisgarh, Maharashtra, and Jharkhand.

In this regard, Mohanty stated that India is not only self-sufficient in meeting its requirement but also capable of becoming a major player in the international bauxite market.

India is fortunate to have about 3,896 million tonnes of bauxite resources as on April 1, 2015, placing it on the sixth position in the global ranking.

But one of the major concerns is the high rate of export duty charged even on non-plant-grade bauxite, making bauxite export unviable from western India, Mohanty explained.

Bauxite export leads to direct and indirect employment, contributing to socio-economic development in local communities. It also generates revenue for the exchequer in the form of royalties, port dues, and taxes, besides contributing to the earning of foreign exchange and helping in reducing trade deficits, noted Mohanty.