MRAI Calls on Government to Eliminate 2.5% Duty on Aluminium Scrap to Boost Recycling Efforts
The Material Recycling Association of India (MRAI) has officially called on the Indian government to abolish the 2.5% basic customs duty (BCD) on aluminium scrap. This request is aimed at bolstering the country’s recycling industry, which heavily relies on imported aluminium scrap to meet about 80-85% of its industrial demand. The MRAI argues that lowering input costs will not only make domestic recyclers more competitive on a global scale but also benefit downstream manufacturers, fostering a more robust circular economy. With India’s secondary aluminium production projected to grow significantly, this change is framed as essential for sustainability and continued industrial growth.
The removal of this customs duty holds considerable implications for the average citizen and the market. A decrease in input costs for recyclers could lead to lower prices for aluminium products, making them more accessible to consumers. Furthermore, a thriving recycling sector could generate substantial job opportunities, particularly as MRAI emphasizes the role of women in the workforce engaged in these activities. As the industry expands, it will not only contribute to economic growth but could also enhance resource security and operational efficiencies, ultimately benefiting consumers through more stable pricing and improved product availability.
Looking ahead, the government and the Reserve Bank of India (RBI) will need to assess the broader economic impact of such a policy change. If adopted, this move could signal the beginning of a more comprehensive approach to regulatory frameworks surrounding recyclable materials, positioning aluminium scrap as a vital component of the industrial supply chain. The potential abolition of the BCD could lead to ongoing dialogues with stakeholders, including the MRAI, addressing the need for strategic materials in the manufacturing sector. Ultimately, effective policymaking in this arena may play a pivotal role in enhancing India’s status in the global recycling industry in the coming years.
Source: The Hindu
(Expert Note: This report was independently prepared by the Wealthova Economy team.)