Union Budget 2020-21: Metal recycling sector urges govt to remove duty on scrap imports

Press Trust of India

New Delhi: A secondary metal players' industry body has urged the government to remove import duty on metal scraps in the upcoming budget.

Pointing out that the Indian secondary metals sector is mainly dependent on imported scrap due to low local supplies, the Material Recycling Association of India (MRAI) said that customs duty should be removed to boost imports.

The basic customs duty on metal scraps is in the range of 2.5 to 5 percent at present.

"Indian secondary metals sector relies heavily on imported metal scrap. Over the years, India has been a net importer of metal scrap largely due to non-generation of sufficient scrap in India and thus the import of the same must be promoted," the MRAI said.

Representational image. Reuters

Representational image. Reuters

While 35 percent of metal scrap is being generated by domestic collection, 65 percent of the requirement of scrap is met through imports, it noted.

The strong growth in scrap business suggests that the metal industry can increasingly replace natural resources by scrap, thereby conserving raw materials, energy, and reducing CO2 emissions, the MRAI said.

"We urge the government to consider metal recycling as a priority sector which offers many benefits for sustainable future," it said.

The recycling industry also generates employment for approximately 8-10 million people in India, according to the association.

Usage of metal scrap is promoted all over the world while the government is levying basic custom duty on metal scraps in the range of 2.5 to 5 percent, MRAI President Sanjay Mehta said while requesting the government to bring the basic customs duty to zero.

The scrap metal industry is mainly fragmented into ferrous and non-ferrous scrap business.

Ferrous scrap is the crucial raw material for the domestic secondary steel and stainless steel sectors while non-ferrous scrap metal is used for manufacturing metallic goods used in automobile, foundries, transport, engineering, construction, railway, packaging, household appliances, and consumer electronics.

MRAI said it represents more than 1,200 members of the ferrous and non-ferrous metals recycling industry.

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