Industy seeks zero custom duty on bauxite ore exports

The bauxite industry in the country today demanded a complete abolition of custom duty on bauxite ore export, which is currently at 15 per cent.
In a statement issued here, Gujmin Industry Association Chairman C K Joshi said, "In the last budget, custom duty on export of iron ore lumps and chromium ores was reduced from 30 per cent to zero per cent, but that on export of bauxite ore was reduced from 20 per cent to just 15 per cent, which was inadequate."
"This relief may be too little, too late, to rejuvenate the bauxite export industry, which is already battling headwinds from the meltdown in the global commodity markets. Therefore, we demand custom duty on export of bauxite ore should be reduced to zero," he said.

Bauxite is the primary ore for making aluminium metal and India is known to be endowed with the 5th largest bauxite reserve base in the world of 3 billion tonnes.
There is still a lot of potential for discovering a larger bauxite resource base in India through modern and scientific prospecting methods. Furthermore, India currently produces less than 2 million tons of aluminium per annum, at India's current rate of aluminium production and consumption, India's known bauxite reserves will last for more than 300 years.
More than 80 per cent of India's bauxite reserves are located in the states of Odisha and Andhra Pradesh. The Kutch region of Gujarat is known to have bauxite of good quality, which has for the last six decades been set aside by the Government of Gujarat for an alumina refinery.

According to him, inferior bauxite from the Jamnagar region of Gujarat and from Maharashtra is unusable by Indian metal manufacturers on account of its low alumina content and high silica content. From a domestic perspective this bauxite is waste-ore

"Certain small mine owners and export aggregators have over the last ten years taken the initiative to mine and export these inferior ores and have succeeded in developing a sustainable "mining industry" which generates direct and indirect employment in mining, transportation and stevedoring to more than 50,000 labourers in Gujarat & Maharashtra," he said.
China produces and consumes nearly half of world's aluminium for which it needs to import bauxite, Joshi said adding that the neighbouring country has may other sources for importing bauxite namely Malaysia, Australia and Guinea.

The Indian bauxite industry has provided more than USD 700 million forex inflows over the last three years, leading to royalty accruals of more than Rs 200 crore and over Rs 500 crore as indirect taxes and generated more than 50,000 jobs is in dire straits, Joshi added.