Downstream Aluminium Companies to Benefit from New Anti-Dumping Duties; Producers Seek Similar Steps in Budget 2025

Bhubaneswar, Dec 2: The Aluminium Association of India (AAI) has welcomed the recent decision by the Government of India to impose anti-dumping duties on anodized aluminium frames for solar panels and modules from China. This move is expected to provide relief to the downstream aluminium industry by enabling broader domestic market access.

In the lead-up to Budget 2025, stronger protections from imports to facilitate market access have emerged as a key industry demand. Such measures are seen as vital for establishing a self-reliant aluminium sector in India. They are expected to encourage new investments, create jobs, promote the growth of MSMEs, and enable greater socio-economic inclusion of remote areas.

The domestic aluminium industry, grappling with a surge in aluminium imports—comprising both primary and downstream products, including foreign scrap—has made several representations to the government. The industry has called for increased import duties on primary and downstream aluminium products (from 7.5% to 10%) and a uniform 7.5% duty on aluminium scrap to curb the inflow of low-quality scrap.

Recognizing the negative impact of excessive imports, the Ministry of Finance noted in its notification that “the dumping of subject goods from the subject country has materially retarded the establishment of the domestic industry.” The anti-dumping duty, effective for five years, is expected to curb such practices. Aluminium producers, however, stress the need for similar protections against imports of primary and scrap aluminium to safeguard the industry and ensure capacity growth to meet the projected demand of 10 million tonnes by 2030.

Currently, aluminium imports account for 54% of India’s total demand, leading to a forex outflow of INR 56,291 crores, or 1% of India’s total annual import bill. A significant portion of these imports originates from China, the Middle East, and increasingly the US and UK, mainly in the form of low-quality scrap. Scrap imports, often unregulated by quality standards, have doubled from 869 KT in FY15 to an estimated 1,825 KT in FY25, exacerbating challenges for the domestic industry.

In contrast, advanced economies have implemented strong measures to protect their aluminium sectors. For instance, the US imposed a 10% tariff on aluminium imports, and China introduced a 25% duty on aluminium scrap imports from the US, coupled with other restrictions. Meanwhile, India has become the largest aluminium scrap importer, hampering the domestic industry’s growth potential.

The anti-dumping duties are thus seen as a positive step for India’s aluminium sector. A spokesperson for the Aluminium Association of India stated, “The imposition of anti-dumping duties reflects the government’s commitment to fostering a self-reliant and competitive aluminium industry in India. We are optimistic about similar measures in the upcoming budget to empower domestic aluminium producers, enabling them to support the global energy transition and invest in capacity expansion to meet growing demand.”

These duties are expected to promote downstream aluminium value addition in the country. If further duty barriers are introduced, they will restrict aluminium imports, encourage domestic producers to expand capacity, and significantly contribute to the vision of a ‘Viksit Bharat.’