Mecon preparing report on aluminium MIP
State-run consultancy firm Mecon is preparing a report on the feasibility of imposing a minimum import price (MIP) on aluminium products on the lines of one on steel items.
The public sector undertaking has been asked by industry body Aluminium Association of India to prepare the report, which it has to submit by September, a source said. The development comes in the backdrop of the ministries of finance, commerce and mines exploring ways to check imports of cheap aluminium, which is impacting sales and profits of domestic producers.
Last week, Aluminium Association met Finance Minister Arun Jaitley and pitched for protective measures against cheap imports. Top officials from Vedanta, Nalco, Hindalco and Balco also made a case for imposing MIP on aluminium products.
The industry body said China, the world's largest producer and consumer of metals including aluminium, is exporting surplus aluminium amid weak domestic demand. The situation is alarming as 50 per cent of the metal consumed in India is coming through imports, it said.
According to industry data, primary aluminium producers incurred losses of around Rs 4,025 crore in the last fiscal, substantially higher than Rs 1,480 crore in 2014-15.
Out of total aluminium consumption in India, 55 per cent is met from scrap and 45 per cent through aluminium, on which import duties are 2.5 per cent and 5 per cent, respectively, resulting in cheap imports from countries like China.