The Aluminium Association of India (AAI), the apex body representing the Indian aluminium industry, has urged the gGovernment to extend the Remission of Duties or Taxes on Export Products (RoDTEP) Scheme for aluminium-producing units located within Advance Authorisation (AA) holders, Export Oriented Units (EOUs), and Special Economic Zones (SEZs).
In a representation to Finance Minister Nirmala Sitharaman, the AAI said that export-oriented aluminium-producing units currently have to pay a high incidence of both Central and State taxes, constituting up to 10 per cent of production costs. The global competitiveness of Indian aluminium exports would be affected without an extension of the RoDTEP scheme, the association said in a statement.
The government had previously notified RoDTEP rates for aluminium smelters in AA/EOU/SEZ units in March 2024 with an extension granted in September 2024. It is now awaiting an extension beyond February 2025.
2nd largest producer
With over $20 billion invested in growing domestic capacity, India is the second largest aluminium producer globally with an annual capacity of 4.1 million tonnes. Consistent investments in quality manufacturing facilities have led to demand for India-made aluminium in the global market, with nearly 45 per cent of the nation’s aluminium exports currently originating from AA/EOU/SEZ-based units.
Though previously covered under its ambit, the inclusion of this category of aluminium producers within the RoDTEP scheme lapsed in February this year. Given the ongoing global trade uncertainties, the AAI has stressed the need to further extend the applicability of the RoDTEP Scheme for exports from aluminium producers located in AA/EOU/SEZ units. Further delay could leave Indian industries vulnerable to the impact of global trade uncertainties, leading to extensive production cuts, job losses, and hampered domestic growth.
As the government continues to roll out diverse measures to provide a fillip to Indian manufacturing, ensuring a level playing field through the continuation of the RoDTEP scheme will boost India’s export competitiveness and encourage manufacturers to invest in further value addition within the domestic aluminium industry.