The Indian aluminum sector is anticipating support of government policies to pull itself out of the crisis such as flooding of cheap imports, rising coal prices.

In the duration of last 4 Years, the domestic aluminum producers have poured around Rs 1.2 lakh crore to boost the capacity of from 2 MTPA to 4.1MTPA, on the grounds were the total debts on the industry is somewhere around Rs 70,000 Crore. According to the data, the domestic aluminum capacity of the country is 4.1 million tons/annum in front of domestic demand of 3.3 million tons per annum. This depicts that there is ample of domestic capacity to fulfill the country’s aluminum demand of 125%.

One of the major restraining factor of domestic aluminum market is even though the capacity figures are higher than that of demand, 50% of the consumption of aluminum is fulfilled by the imports made from Gulf and China. In addition, among these imports, 50% of it is scrap constitutes which fetch lesser duties, which is eventually damaging the Make in India initiative objective and furiously hindering the domestic aluminum industry.

The LME upswing, which was expected to bring relief to the Indian Aluminum industry that is ailing condition at present, has been distressed owing to rise in the production cost in last some quarters in fiscal 2017–2018. The domestic market is reeling under rise in input costs.

In the recent years, the cost of metal production has drastically increased owing to the roll out of various tax reforms, cess, and duties, with addition of escalated raw materials prices such as Caustic Soda, Alumina, CP Coke, and Coal. The domestic aluminum market is highly impacted owing to these factors. Thus, confusion about the GST procedures also hindered the growth of the market till some extent.