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From being a net importer of copper, India could become a net exporter of the red metal, probably from the next fiscal, with the ₹8,373-crore Kutch Copper Ltd (KCL), a unit of Adani Enterprises Ltd, set to become operational by the end of the current fiscal in Gujarat.
India turned a net importer in 2017-18 with shipments into the country topping 2.75 lakh tonnes last fiscal. Coal and Mines Minister Pralhad Joshi told Parliament in December that ₹27,131 crore was spent on the import of the red metal last fiscal compared with ₹21,985 in 2021-22.
KCL, to be set up in Mundra Special Economic Zone, will have 5 lakh tonnes capacity in the first phase and an additional 5 lakh tonnes in the second phase, according to documents seen by businessline.
Production to double
At the Adani Group’s annual general meeting last year, its Chairman Gautam Adani said the copper smelter is a key project underway and is on schedule.
Sources said a consortium of banks led by the State Bank of India (SBI) made the financial closure (tying up funds) for the greenfield project with equity invested by Adani Enterprises Ltd. In addition, it has got all the major approvals in place to ensure timely execution.
If KCL becomes fully operational next fiscal, India’s copper production will nearly double. According to the Ministry of Mines, copper production in the 2022-23 fiscal was 5.55 lakh tonnes against a capacity of 7.85 lakh tonnes.
Sources said while the country’s copper production capacity will increase by 63 per cent, total production could rise to about 10 lakh tonnes.
Leaving surplus
Until 2017-18, the country’s copper production capacity was 10.28 lakh tonnes with Birla’s Hindalco having a five lakh tonnes capacity and Sterlite 4.6 lakh tonnes with Hindustan Copper making up the rest.
However, with the Tamil Nadu government closing Sterlite Copper in 2018 following unrest and protests, the production capacity of the red metal in the country declined from 8.42 lakh tonnes in 2017-18.
Data from the Ministry of Mine show that copper production during the April-January period of the current fiscal was 4.65 lakh tonnes. According to the ministry, the size of the Indian copper industry (consumption of refined copper per annum) is around 6.6 lakh tonnes, which as percentage of world copper market is three per cent.
This would mean the country would have some surplus to export, which will depend on the capacity utilisation of these plants.
Sources said KCL has entered into long-term supply agreements for supply copper concentrate, a key raw material. A strategic location and an integrated value chain advantage will make KCL one of the low-cost producers of the metal.
Interestingly, during the hearing on Vedanta’s plea on resuming the Thoothukudi plant, the Tamil Nadu government argued that KCL “is capable of fulfilling the country’s copper demand” and the Sterlite plant should not be considered a national asset.
The KCL plant will have zero liquid discharge and explore using green power and deploying byproducts for cement and other businesses.
Besides 5 lakh tonnes of refined copper, KCL will annually produce 2.5 lakh tonnes copper rods, 15 lakh tonnes of sulphuric acid, 25 tonnes of gold, 250 tonnes of silver and 150 tonnes of selenium.
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