Material Recycling Association of India Calls for Removal of Aluminium Scrap Duty

New Delhi, India Jul 12, 2026 ALN: The Material Recycling Association of India (MRAI) has made a significant appeal to the government, urging the removal of the 2.5% basic customs duty (BCD) on aluminium scrap. This request is aimed at promoting a circular economy and enhancing the competitiveness of the recycling industry in India. The MRAI’s call comes at a time when the global emphasis on sustainability and environmental responsibility is growing, and India is seeking to position itself as a leader in the recycling sector.

According to MRAI, the abolition of this duty is essential for lowering input costs for recyclers and downstream manufacturers, enabling them to compete more effectively in the global market. The association pointed out that India is heavily reliant on imported aluminium scrap to meet its industrial demand, with imports accounting for approximately 80-85% of the country's aluminium scrap requirements. This dependency on imports not only affects the cost structure of domestic manufacturers but also raises concerns regarding the stability and security of supply chains.

In a letter addressed to the Prime Minister's Office (PMO), MRAI emphasized the necessity of ensuring uninterrupted access to imported aluminium scrap. This access is deemed crucial for sustaining domestic manufacturing and fostering the growth of the recycling industry. The recycling industry plays a vital role in reducing waste and conserving natural resources, making it essential for the government to support its growth through favorable policies.

MRAI highlighted the impressive growth of India’s secondary aluminium production, which has surged from 0.85 million tonnes in FY16 to an estimated 2.2 million tonnes in FY26. This growth now represents around 35% of the total aluminium production in the country. The increase in secondary aluminium production signifies a shift towards more sustainable manufacturing practices, as recycling aluminium requires significantly less energy compared to primary production from bauxite ore. This reduction in energy consumption translates to lower greenhouse gas emissions, aligning with global climate goals.

The association's call for duty removal is not just about reducing costs; it is also about enhancing the sustainability of the industry. By lowering the financial barriers associated with importing aluminium scrap, MRAI believes that the recycling sector can thrive, ultimately contributing to a more sustainable and environmentally friendly economy. The recycling of aluminium is particularly important, as it is one of the most recycled materials globally, with the potential to be recycled indefinitely without losing quality.

In conclusion, the MRAI's request reflects a broader vision for the recycling industry in India. By advocating for the removal of the 2.5% duty on aluminium scrap, the association aims to support local manufacturers, reduce dependency on imports, and promote a circular economy that benefits both the environment and the economy. The circular economy model emphasizes the importance of reusing resources and minimizing waste, which is increasingly becoming a priority for governments and industries worldwide.

Furthermore, the implications of this duty removal extend beyond just the recycling sector. It can lead to job creation in the recycling and manufacturing industries, as lower costs could encourage expansion and investment. This, in turn, could stimulate economic growth and enhance India's position in the global aluminium market. The MRAI's appeal aligns with the government's initiatives aimed at boosting the manufacturing sector under the 'Make in India' campaign, which seeks to transform India into a global manufacturing hub.

Additionally, the removal of the customs duty could also have positive implications for the environment. By making it cheaper to import aluminium scrap, the MRAI argues that more businesses may opt for recycling over primary aluminium production, which is more resource-intensive and environmentally damaging. This shift could lead to a decrease in the carbon footprint associated with aluminium production and contribute to India's commitments to international climate agreements.

It is also important to consider the challenges that the recycling industry faces, such as fluctuating prices of scrap materials, regulatory hurdles, and the need for technological advancements. Addressing these challenges will be crucial for the long-term sustainability of the industry. The MRAI's appeal for the removal of the customs duty is a step towards creating a more favorable environment for recyclers, but it must be part of a broader strategy that includes investment in technology, infrastructure, and workforce development.

In summary, the MRAI's push for the removal of the 2.5% customs duty on aluminium scrap is a strategic move aimed at bolstering the recycling industry in India. By advocating for this change, the MRAI is not only addressing immediate economic concerns but also laying the groundwork for a more sustainable and resilient industrial future. As the global economy continues to evolve, the importance of recycling and sustainable practices will only increase, making it imperative for India to adapt and lead in this crucial sector.

To further understand the implications of this appeal, it is important to contextualize the role of aluminium in the global economy. Aluminium is a versatile metal widely used across various industries, including construction, transportation, and packaging. Its lightweight nature and resistance to corrosion make it a preferred choice in many applications. However, traditional aluminium production is energy-intensive and contributes significantly to greenhouse gas emissions. Therefore, recycling aluminium is not only economically advantageous but also environmentally essential.

The global aluminium market is increasingly leaning towards sustainability, with many countries implementing stricter regulations on carbon emissions and waste management. As nations strive to meet their climate targets, the demand for recycled materials is expected to rise. In this context, India's recycling industry has the potential to become a key player in the global market if it can overcome the challenges posed by import duties and other regulatory barriers.

Moreover, the MRAI's appeal for duty removal aligns with international trends where many countries are adopting policies to encourage recycling and the use of secondary materials. For instance, the European Union has implemented various directives aimed at promoting a circular economy, which includes incentives for recycling industries. By removing the customs duty on aluminium scrap, India could mirror these international practices, thereby enhancing its global competitiveness and attractiveness as a destination for investment in the recycling sector.

In addition to economic and environmental benefits, the MRAI's appeal has social implications as well. The recycling industry is labor-intensive and can create numerous job opportunities across various skill levels. From collection and sorting of scrap materials to processing and manufacturing, a thriving recycling sector can provide employment for thousands of individuals, contributing to economic development and poverty alleviation. This is particularly pertinent in a country like India, where unemployment rates have been a persistent challenge.

Furthermore, the rise of the recycling industry can foster innovation and technological advancements. As demand for recycled aluminium increases, there will be a corresponding need for improved technologies and processes. This can lead to research and development initiatives aimed at enhancing recycling efficiency and reducing costs. Such advancements can not only benefit the recycling sector but also spill over into other industries, driving technological progress across the economy.

In conclusion, the MRAI's call for the removal of the 2.5% customs duty on aluminium scrap is a multifaceted issue that encompasses economic, environmental, and social dimensions. As India seeks to strengthen its recycling industry and transition towards a more sustainable economy, the government's response to this appeal will be crucial. The removal of the duty could serve as a catalyst for growth, innovation, and job creation, positioning India as a leader in the global recycling landscape. The interplay between policy, industry, and sustainability will ultimately shape the future of India's recycling sector, making it imperative for stakeholders to engage in constructive dialogue and collaborative efforts to realize this vision.