Aluminium industry body sticks to custom duty hike demand; refutes ASMA’s claim of MSMEs to take a hit

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January 29, 2020 7:29 PM

Trade, Imports, Exports for MSMEs: Import duty hike will be “a serious blow to more than 3,500 small and medium businesses involved in manufacturing aluminium downstream products,” ASMA had said.

AAI wrote a letter to the Principal Secretary to Prime Minister Narendra Modi on Wednesday.

Trade, Imports, Exports for MSMEs: Industry association for aluminium producers and downstream manufacturers — Aluminium Association of India (AAI) has hit back at another association in the aluminium sector — Aluminium Secondary Manufacturers Association (ASMA) for the latter’s claim that AAI at the behest of India’s two major aluminium producers — Hindalco and Vedanta is putting pressure on the government to increase customs duty on aluminium metal and scrap. AAI, in a letter to the Principal Secretary to Prime Minister Narendra Modi on Wednesday, refuted ASMA’s claim that AAI is doing so for earning more profit for the two companies as AAI is their ancillary unit.

The increase in import duty will be “a serious blow to more than 3,500 small and medium businesses involved in manufacturing aluminium downstream products,” ASMA had said in an advertorial in an English business newspaper on Monday. The advertorial read that AAI has been giving multiple proposals to the government to restrict the import of aluminium metal and scrap by increasing customs duty or levy of safeguard duty or introducing minimum import price etc but so far they have not been successful as none of these proposals were justified.

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AAI in response to the alleged blame and reiterating the requirement for an increase in aluminium import custom duty said the industry has sought government support against “adverse challenging phase due to increasing imports. After examining the facts and damage being caused by imports, the government have also supported the industry as per following: first, Ministry of Finance increased basic custom duty on Aluminum products (both primary and secondary) by 2.5 per cent in the FY17 budget.”

Secondly, said AAI, “Directorate General of Safeguards (DGS) recommended provisional 5% Safeguard Duty on Aluminium Imports in April 2016 after its preliminary findings. Third,  Mecon — a government enterprise conducted a study for Minimum Import Price (MIP) on Aluminium imports (both primary & secondary products), based on which Ministry of Mines recommended Ministry of Commerce & Industry (MoCI) to impose MIP on Aluminium imports in March 2017. The association claimed to be the only association to represent the entire spectrum of Indian Aluminium Industry having around 160 members, with over 100 industries as its member instead of an ancillary unit as alleged by ASMA.

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