Piyush Goyal, Minister of State with Independent Charge for Power, Coal, New and Renewable Energy and Mines (Photo: Vivan Mehra)
To counter "dumping" of cheap aluminium products, Mines Minister Piyush Goyal said he is in favour of imposing a Minimum Import Price (MIP) on the metal to "protect" the domestic industry.
The minister suggested that the MIP should be similar to the one imposed by the government for the steel sector, which too has been grappling with similar dumping from China, Japan, and South Korea, among others.
"My personal view is that an MIP on aluminium products should be imposed as I would like to protect the domestic aluminium industry. There is a strong case that dumping is happening and we need to correct it," Goyal told PTI.
India cannot become a dumping ground for cheap imported products and goods, he added.
When asked about the ministry's view, he said: "Well, you have to examine the merits and demerits of the matter. But this government is committed to saving the domestic industry from dumping of products by other countries."
He added that the ministry believes in a sustainable growth of domestic industry.
"We are examining all aspects and will take a decision on the matter in the near future. The Finance and Commerce Ministry, however, will take a final call on this (MIP on aluminium)," Goyal, who also holds charge of Power, Coal and Renewable Energy, said.
On the report being prepared by the state-run consultancy firm Mecon on MIP for aluminium products, he said the report is basically on if an MIP is required for the aluminium sector.
On doubts being raised if it will lead to a conflict of interest, the minister said: "No, Mecon's job is to only provide the facts. They are not giving any recommendations.
Industry will provide the data and Mecon will compile them and present it."
Earlier this month, industry body Aluminium Association of India met Finance Minister Arun Jaitley and pitched for protective measures against cheap imports. Top officials from Vedanta, Nalco, Hindalco and Balco also made a case for imposing MIP on aluminium products.
It said China, the world's largest producer and consumer of metals, including aluminium, is exporting surplus quantities of the metal amid weak domestic demand.
According to industry data, primary aluminium producers incurred losses of around Rs 4,025 crore in the last fiscal, substantially higher than Rs 1,480 crore in 2014-15.
In order to protect the industry, government in Budget 2016-17 raised customs duty on primary aluminium to 7.5 per cent from 5 per cent, while levy on other aluminium products was hiked to 10 per cent from 7.5 per cent.