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Aided by power and automotive sectors and the government’s ‘Make in India’ thrust, aluminium demand in the country is expected to touch five million tonne (mt) by 2020 and eight mt by 2025 up from 3.2 mt now.
According to data by Aluminium Association of India (AAI) and Crisil Research, the country’s aluminium consumption clocked CAGR (compounded annual growth rate) of eight per cent during 2011-16. The same trend is expected to prevail till 2020.
Aluminium usage would look up as power demand is expected to shoot up from 290 Gw currently to 360 Gw by 2020-21 whereas auto demand is projected at 38 million units by then, up from 25 million units by the end of FY16.
Building & construction sector is billed as the next growth driver as aluminium with its light weight quality finds enhanced application. Further, the Government of India’s push for ‘Make in India’ especially in defence sector is expected to open up a gamut of opportunities for the white metal. Aluminium is widely used in defence equipment like military aircraft, ammunition hardware and missiles in the form of sheets, forgings and extrusions.
“The primary aluminium consumption increased by 23 per cent and total aluminium consumption increased by 13 per cent in last one year. This year, the projected growth in aluminium demand is 11 per cent. The consumption will be led by electrical & transport sectors and government initiatives on infrastructure, Smart Cities and Railways”, said a senior executive with an aluminium company.
In developed countries, aluminium has over 3,000 applications whereas it is limited to only 300 applications in India. But, there is enormous scope to enhance usage as the country’s per capita aluminium consumption is a measly 2.2 kg as against the world average of 10 kg and 25 kg for China with comparable population. Germany ranks first with per capita aluminium consumption of 42.1 kg followed by Taiwan at 33.3 kg.
Electricals have the bulk share of aluminium consumption in the country at 40 per cent; transport comes next with 23 per cent share. This contrasts with the world consumption where auto sector has the biggest share with 28 per cent.
Indian aluminium producers have invested Rs 1.5 lakh crore on upstream and downstream facilities. While the primary aluminium capacity is two mtpa, the manufacturers have diversified to other capacities like wire rods, new extrusion apresses, rolling plants and foils.
