India scrap aluminium importers oppose duty charge

DUBAI, June 23 (Reuters) - India's scrap aluminium traders are in talks with the government to seek a rejection of a request by primary metal producers for an import duty charge on scraps, traders said on Tuesday. The Aluminium Association of India, which represents the interests of the private primary aluminium producers, filed a request late last month to the Directorate General of Safeguards Customs and Central Excise to impose a duty on imports of scrap aluminium, a statement from the custom authority said. "The primary aluminium producers want to limit the imports of scrap aluminium because the prices of the products we produce from scrap are more competitive," said Zain Nathani, managing director of Nathani Industrial Services, an Indian scrap metal importing firm. India's Aluminium firms have claimed a 6,707 rupee loss per tonne of the metal during the first quarter of this year, compared with a profit of 5,149 rupees per tonne during the last quarter of 2008. "Increased imports [of scrap] are also leading to the loss of employment," the statement said. It added that in 2007-2008 the industry had employed around 6,530 people and by March this year the number had dropped to 5,615. The statement did not include a proposed percentage for the duty change, however traders told Reuters that it might be in the range of 10 percent to 20 percent. "If this duty charge is implemented it would really limit our imports and I don't understand why the government would want to stop recycling metals," said Aditya Gupta, a trader from Meenakshi Metallics, a scrap metal firm based in Mumbai. This week the Bureau of International Recycling (BIR), a global federation of industries involved in recovery and recycling of metals started negotiations with the custom authorities to stop the import duties from being imposed. "Recycled raw materials should always be promoted and it's a well documented fact that recycling one tonne of aluminium conserves up to eight tonnes of bauxite ore and 14 megawatt hours of electricity," said Ikbal Nathani, BIR's representative in India. During the first quarter of this year India imported 131,858 tonnes of scrap aluminium which represents 49.74 percent in relation to the primary aluminium production, according to local industry statistics. Earlier this month India eased import restrictions on scrap metals and released thousands of tonnes of scrap that were held in customs after elevator buttons made from the metal and exported to Germany were found to be radioactive.