Tax breaks for corrosion control in the works

The Union Ministry Commerce is in talks with the Ministry of Chemicals and Fertilizers to launch a national mission for controlling corrosion in metals before end of April. The idea is that companies which bring down the levels of corrosion in their plants and machineries will be given tax incentives. Corrosion is degradation of metals due to interaction with the environment. Molecules of nitrates, sulphates and phosphates, which are present in the air, react with moisture to form acids, which eat away the metals.

An industry source said that the preparatory work is almost over. The Union Ministry of Chemicals and Fertilizer will be the nodal ministry for implementing the mission. Along the lines of Bureau of Energy Efficiency, a Bureau of Corrosion Control (BCC) will also be set up, which will facilitate the process of tax breaks.

The US Government is already providing tax incentives to industry; the US model would be studied for providing similar incentives to Indian companies, the source said.

Leading nuclear metallurgist and former director of Indira Gandhi Centre for Atomic Research, Baldev Raj is leading a detailed study on the corrosion and its impact on the Indian economy. The Federation of Indian Chambers of Commerce and Industry (FICCI) and NACE International are also part of the study.

Raj told BusinessLine said the estimated loss to the GDP from corrosion is between four to six per cent, which can be reduced to two per cent by taking very simple steps such as using additional paint and material coatings for metal structures and using uncontaminated water during construction. Companies, who will get tax breaks for reducing corrosion, will produce better quality goods in their plants, he said.

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