In a submission to the Central Board of Indirect Taxes (CBIC), the association emphasized that as the global market prioritizes imports of high-quality scrap, it is imperative for India to adopt similar quality standards.
The association remarked that major economies are shielding their domestic aluminium sectors through elevated import duties and other trade measures to attract investment, expand capacities, and lessen reliance on imports. India should bolster its protective measures as well.
It requested the government to maintain the current duty framework on aluminium products and contemplate increasing the basic customs duty and other trade measures to address the influx of low-quality scrap. They cited examples from countries like Mexico, the US, and Canada, where duties are set between 15% and 50%.
The association urged that the final BIS standard titled ‘Aluminium & Aluminium Alloy Scrap – Requirements & Conditions of Delivery’ be published as is, noting it has received approval from entities such as NITI Aayog and BIS.
This will help ensure that India does not turn into a dumping ground for unregulated hazardous global aluminium scrap.
Once implemented, it would categorize aluminium scrap into various grades based on its aluminium content, spanning from above 95% to below 60%, they noted.
The association also called on the government to preserve the current import duty on aluminium scrap until the pending BIS quality standard is adopted and grade-wise HSN (harmonized nomenclature) codes are introduced.
This will enable the government to differentiate between high-quality scrap utilized by recyclers and lower-grade scrap containing higher impurities, they stated.
Moreover, it proposed increasing the import duty to 7.5% on low-grade aluminium scrap (Grades 3 to 7) to limit imports of poor-quality scrap entering the nation.
“To restrict imports of low-quality scrap, import duty on low-grade scrap should be raised to 7.5%,” they noted.
A well-structured customs duty framework, along with the prompt notification of BIS scrap standards, will aid in protecting domestic value generation while fostering quality-led recycling, they added.
As per data from the Ministry of Commerce, aluminium imports have surged from 1.53 MTPA in FY15 to 3.48 MTPA in FY26, with the import bill soaring from ₹23,328 crore to ₹88,434 crore in the same time frame.
Scrap imports alone have escalated from 840 KTPA in FY15 to 2,028 KTPA in FY26, causing a forex expenditure of ₹40,203 crore.
“To advance India’s circular economy objectives for the secondary aluminium industry, it is crucial for the government to establish a robust domestic scrap collection and recycling framework. This will mitigate forex losses caused by aluminium scrap imports (₹40,203 crore in FY26),” they stated.
