Miners body urges govt not to impose anti-dumping duty on caustic soda

The Federation of Indian Mineral Industries (FIMI) has requested the government not to impose any anti-dumping duty on imports of caustic soda from four countries, including Japan and Oman, pointing out that any such restriction will hamper the economic viability of domestic aluminium industry.

Aluminium industry is one of the major consumers of caustic soda in the country.

"We understand from our aluminium industry based members that Directorate General of Trade Remedies (DGTR), Ministry of Commerce and Industry vide its Notification No. AD-01-30/2020 dated 16th December, 2021 has recommended for anti-dumping investigations concerning imports of 'caustic soda' originating in or exported from Japan, Iran, Qatar and Oman.

"We would request you to kindly consider not to impose any anti-dumping duty on imports of caustic soda originating in or imported from our Japan, Iran, Qatar and Oman," Federation of Indian Mineral Industries (FIMI) said in a recent letter to the government.

The miners' body further said that with the revival of economy and post pandemic industrial activity back on track, any further restriction on import of caustic soda which is one of the major raw materials for aluminium will hamper the economic viability of Indian aluminium industry thereby affecting the overall economy.

The burden of any additional tariffs will be detrimental for the sustainability and cost competitiveness of aluminium industry as unlike other industries, it cannot pass through the burden of escalated cost to end consumer as the global aluminium prices are governed by London Metal Exchange, it said.

Import of caustic soda in India is already restricted through various tariff and non-tariff barriers, it said adding that there has been significant decline in imports of caustic Soda (HS Code 281511).

Majority of domestic production of caustic soda (non-captive) is in the Western region of the country, mainly in Gujarat, Maharashtra and Rajasthan whereas all major alumina producers are located in Eastern region of the country --Odisha, Andhra Pradesh, Jharkhand and Karnataka among others. This creates a huge logistics challenges resulting in exorbitant freight costs for transportation from western to eastern regions besides unavailability of sufficient railway rakes and network congestions, the letter said.

Moreover, the transportation through road mode is also not feasible over such long distances. As a result, the domestic suppliers have concentrated their supplies in the geographies near to their plant locations.

"The domestic caustic soda industry is not able to cater to the bulk requirement of aluminium industry which requires large shipment....Thus, the domestic consumers are left with no other option but to import caustic soda to meet domestic requirements," it said.