National Aluminium Company (Nalco) does not see any impact from the protectionist 10 per cent import tariff levied by the Donald Trump administration in US.
Nalco, a key producer, has been primarily exporting to countries in South East Asia. The import duty by US does not perturb the company as its exports to USA have been almost negligible.
India’s overall aluminium exports to the USA are also quite minuscule compared to China, Canada or the Middle East countries. India’s share of aluminium imported by US in volume terms is a measly two per cent. On the contrary, Canada, China and Middle East account for an overwhelming 73 per cent of the total aluminium imported by US.
Last fiscal, Indian aluminium companies exported 125,000 tonnes of aluminium to US, most of it was made up by ingots. In the ongoing fiscal, the aluminium firms based in India have shipped only 71,000 tonnes to US by the end of December.
Still, aluminium lobby body Aluminium Association of India (AAI) has moved the Union ministry of commerce & industry to take up the case for exemption from the US imposed levies. The US government is renegotiating the tariff issues with countries and it has already offered waiver to Canada and Mexico under the terms of the North American Free Trade Agreement (NAFTA). Australia, too, has received exemption from the aluminium import tariff on its status of being a strategic partner of the US. AAI has demanded similar exemption for the Indian aluminium companies as well. The association said that the US recognised India as a strategic ally and hence, the exemption needed to be extended to the country’s aluminium makers. More, the aluminium products exported from India pose no threat to the domestic industry in US nor do they endanger jobs. Instead, products sourced from India cater to the growing US demand for high grade aluminium alloys.
In 2017, US had an aluminium making capacity of 1.8 million tonnes against which it produced 0.78 million tonnes. But, its total aluminium consumption was significantly higher at 5.51 million tonnes of which 5.04 million tonnes were fed by imports.
Indian aluminium exports to the US are valued at $350 million. This means the Indian producers have only 0.8 per cent share to the overall aluminium exports to the US of the order of $42.2 billion.
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