Speaking at an industry event in Jaipur on Monday, MRAI President Sanjay Mehta said high taxes are incentivising cash transactions and weakening formalisation at the first level of scrap collection. “The GST on scrap must be reduced to 5 per cent. The present rate is hurting the organised sector and forcing activity into the informal economy,” he said. Currently, the GST on metal scrap is 18 per cent.
Mehta also urged the government to fully remove import duty on aluminium scrap and strengthen enforcement of Extended Producer Responsibility (EPR) across e-waste, plastics and tyres.
Mehta added that nearly one-third of India’s scrap is sourced from ragpickers, households and small workshops, and that shifting purchases to UPI-based transactions, while discouraging cash payments, is essential for bringing these workers into the formal economy.
The industry’s demands come at a time when India is rapidly expanding its steelmaking capacity and positioning scrap as a core component of its decarbonisation strategy. Addressing the same event, Daya Nidhan Pandey, joint secretary, Ministry of Steel, said scrap availability is expected to rise to 36 million tonnes, with demand set to increase sharply as the country scales up crude steel capacity to 300 million tonnes by 2030 and 500 million tonnes by 2047. Scrap currently accounts for 21 per cent of India’s crude steel output, compared with a global average of around 31 per cent.
Pandey said policy measures, ranging from the Steel Scrap Recycling Policy and the Vehicle Scrappage Policy to new EPR mandates for end-of-life vehicles and construction waste, are expected to accelerate formal recycling and support India’s circular economy goals.
Organised by MRAI, the three-day International Material Recycling Conference and Exposition 2026 in Jaipur is hosting policymakers, recyclers and global stakeholders to discuss sustainability, energy transition and circular economy pathways.
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