FIMI Seeks 15% Customs Duty to Protect Aluminium Sector

21 Nov 2025 CW Team

The Federation of Indian Mineral Industries has recently urged the Ministry of Finance to raise the basic customs duty on primary aluminium and downstream products to 15 per cent, citing a sharp rise in imports and growing risks to domestic manufacturing. The appeal forms part of FIMI’s recommendations for the Union Budget 2026–27, and highlights the increasing diversion of low-quality aluminium scrap into India due to the absence of quality and BIS standards.

FIMI noted that more than Rs 1.5 trillion has already been invested in expanding India’s aluminium production base, with a further Rs 1.6 trillion planned to increase primary capacity to 7.2 MTPA by FY30 and around 9 MTPA by FY33. These investments, aligned with the Aluminium Vision Document, are expected to generate over eight lakh jobs and reinforce the country’s industrial and supply chain resilience.

Despite sufficient domestic capacity, nearly 55 per cent of India’s aluminium demand in FY26 is projected to be met through imports, particularly from China, Russia, ASEAN nations and the Middle East. FIMI also flagged the rising inflow of low-grade aluminium scrap from the USA, EU, UAE and UK, warning that India has effectively become the world’s largest scrap importer.

To address cost pressures, the federation has sought lower duties on critical raw materials and corrective action on the inverted duty structure. High input costs, multiple taxes and cesses, elevated electricity tariffs and logistics expenses continue to make India one of the costliest aluminium producers globally, with taxes alone accounting for about 17 per cent of production costs.

FIMI has urged the government to adopt its recommendations to revitalise mining, promote exports, stimulate investment and support national manufacturing goals under Make in India and Atmanirbhar Bharat.

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