According to foreign media reports, the Indian Aluminium Industry Association (AAI) urged the government to raise the basic tariff on all aluminium products, including scrap aluminium, to 15% before the release of the federal budget for the fiscal year 2026-27. This move is aimed at restricting the influx of low-quality imported products and protecting domestic manufacturers.
The association believes that by taking this measure, the quality standards for aluminum waste in India can be aligned with those of the EU and China, among other globally leading regions and countries. At the same time, it can prevent India from becoming a dumping ground for metal waste.
Furthermore, AAI points out that although domestic production capacity is sufficient to meet current demand, due to the unrestricted import policy, the domestic aluminum industry still faces pressure.
The report also states that with the increase in imports, India's aluminum trade deficit is expected to reach a record high of 300 billion rupees (3.4 billion US dollars) in the fiscal year 2026. Currently, the basic import tariff for primary aluminum products in India is 7.5%, for scrap aluminum it is 2.5%, and the tariffs for downstream aluminum products range from 7.5% to 10%.
To prevent India from becoming a dumping ground for waste materials, the association urges the Indian government to establish strict quality standards for aluminum waste, similar to those currently in place in the European Union, Malaysia and China. Taking these measures will not only promote the development of the domestic waste market, but also contribute to the construction of a circular economy.
In 2025, the price of aluminum on the London Metal Exchange (LME) is expected to increase by more than 20%, and it is predicted to remain at a high level for some time to come. One of the reasons is that China, the world's largest aluminum producer, has set a ceiling of 45 million tons of electrolytic aluminum production capacity. The second reason is that the supply of raw materials such as bauxite is facing shortages, especially in Guinea and Brazil, which has led to a more tense supply situation in the global aluminum industry.
Last year, due to the strong increase in the prices of industrial metals such as aluminum, copper and silver, the stock prices of domestic aluminum producers like Hindalco and Nalco rose by more than 50%.
Meanwhile, global aluminum industry organizations including the International Aluminum Association have announced that there is a structural shortage in the aluminum market for the first time in two decades.
Note: In November 2023, the Indian Aluminium Association had requested the government to immediately impose a 10% tariff on imported scrap aluminium to protect the domestic metal industry from the impact of low-quality scrap aluminium dumping. At that time, India imposed a 2.5% tariff on scrap aluminium.
