Chennai, Sept 28 (KNN) The aluminium industry is witnessing a 2 to 3 per cent decline in its profits because the government has not yet released the rates for the Remission of Duties or Taxes on Export Product (RODTEP) scheme for special economic zones (SEZs) and export-oriented units (EOUs).

India exported 2.5 million tonne of aluminium in FY23 worth USD 5billion. With the scrapping of the earlier Merchandise Exports from India Scheme (MEIS), aluminium exporters are feeling the squeeze, Aluminium Association of India (AAI) member governing council Himanshu Singh said.

“The AAI has already submitted a representation to the Union ministry of commerce and industry seeking urgent intervention for notification of rates under the scheme as this would help boost exports,” he added.

In FY23, India produced 4.1 million tonne of aluminium and also imported 2.5 million tonne of which 1.7 million tonne was scrap import. With over USD 20 billion invested, India is today the second largest aluminium producer in the world.

However, the AAI pointed out that while RODTEP rates for aluminium products manufactured in domestic tariff areas (DTAs) have been notified, the rates for those manufactured within SEZs and EOUs are yet to be informed even through SEZs and EOUs cumulatively represent the source of over 30 per cent of all aluminium exports from India.

At present, unremitted taxes and duties comprise anywhere between 5 per cent and 10 per cent of aluminium production costs for SEZ-based operations.

“But with MEIS scheme already withdrawn and the beneficial rates under RODTEP yet to be extended to this segment, the domestic aluminium industry is struggling to remain competitive in global markets against foreign producers, especially from China,” he added.  (KNN Bureau)