Sterile Copper plant closure back in spotlight as govt concerns over rising copper import
India was a net exporter of copper for close to two decades before the closure of the Sterlite Copper plant at Tuticorin, Tamil Nadu, in 2018.
However, in recent times, the rise in copper import is a great concern for the government, and a better ecosystem must be established to make the domestic copper industry competitive, V K Saraswat, Niti Aayog Member, said.
During a meeting held under the chairmanship of Saraswat this month on copper issues, the Niti Aayog member said, "copper is a vital commodity, and it is imperative that a better ecosystem is established in India for making the copper industry competitive."
Further, he underlined the importance of the reduction in customs duty on copper concentrates from 2.5 percent to 'Nil', recommended by Niti Aayog in 2019, according to the minutes of the meeting.
The issue of a surge in copper imports, with effect from 2018, which has placed India from a net exporter status to a net importer post-2018, was also discussed, it stated.
Sterlite Copper informed the Tuticorin plant was closed on account of the law and order issue, and requested the committee members the government should find some solution to restart the plant as early as possible.
"Member Niti Aayog informed the matter is subjudice, and as a result of which further discussion is not possible," the minutes said.
Further, he informed the management should follow up the case in court for restarting their operations.
India's copper import, which increased 26 percent to 60,766 tonnes in the June quarter of 2021-22, is expected to rise further in the remaining part of the financial year, with economic activity witnessing a strong recovery from COVID-19 related restrictions, International Copper Association had earlier said.
India's copper imports may touch three lakh tonnes as economic growth picks up momentum despite the adequate domestic capacity to meet the rising demand, it had said.
India ended the last financial year with copper imports of 2,33,671 tonnes. With 26-30 percent growth, imports are likely to be in the range of 2,95,000 - 3,04,000 tonnes for the current financial year, the association added.
According to the Ministry of Commerce, India earned a net foreign exchange of $1.1 billion on account of the export of copper in 2017-18. However, after the shutdown of Sterlite Copper's smelter plant, India now incurs a net foreign exchange outflow of $1.2 billion due to imports of copper every year.