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India has overtaken China as the preferred destination for aluminium scrap with imports growing 18.8% in the January-March 2019 quarter compared with the same quarter of the previous year.
The imports has increased due to a trade war between China and the U.S.Trade war is a situation where countries restrict each other’s trade by imposing tariffs or quotas on imports.
The U.S. had imposed an import duty of 10% on aluminium in March 2018 and in response China too had implemented a 25% duty on the import of aluminium scrap.
Further,China has not only put the duty on U.S. scrap but they are also classifying aluminium scrap as a restricted import which will be implemented from July 1,2019.
This has led to the aluminium scrap being diverted and dumped in India.The surge in import of scrap has also led to the Indian domestic industry losing its market share.
In this situation,the Aluminium Association of India has requested the government to increase customs duty on imports to up to 12.5%.At present,the duty varies from 2.5% to 10%, on products such as primary aluminium,scrap and downstream products.
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