AAI urged the Centre to continue with processing of applications through the Directorate General of Foreign Trade (DGFT) MEIS portal.
"The DGFT has also blocked the MEIS module from 23rd July from accepting new applications to limit the issuance of any more scrips. This has created an extremely precarious situation for the Indian Aluminium exports which have declined by 11 per cent from USD 5.7 billion in FY-19 to USD 5 billion in FY-20, and further will render exports vulnerable and uncompetitive vis-a-vis global players in international markets," AAI said in a statement.
The aluminium body also demanded inclusion of aluminium in the product-linked incentive scheme and implementation of Remission of Duties or Taxes on Export Products (RoDTEP) scheme for the aluminium industry to create a level playing field with global players.
Being a continuous process industry, all the Indian aluminium smelters are operating at around 90 per cent capacity. The slump in domestic demand is hurting the aluminium industry and it will take substantial time for the domestic demand to pick up, it said.
The only option left for the industry is to export aluminium products to survive the current situation due to the COVID-10 pandemic, but the prices are expected to be weak due to a demand slump globally, it added.
Aluminium exports from India are struggling to remain globally competitive due to high incidence of unrebated central and state taxes and duties, constituting 15 per cent of aluminium production cost, which is amongst the highest in the world, it said.
This is in sharp contrast to global aluminium industry which is heavily supported by countries, specially China, by way of various incentives/ subsidies for raw materials, tax benefits and other incentives, AAI said.
Aluminium exports are currently eligible for a 2 per cent MEIS reward rate which itself does not provide ample cushion to remain competitive against current bearish market conditions, it added, and pitched for hiking the rate to 5 per cent.
The government has identified aluminium amongst 12 champion sectors where India can be a global leader and major supplier.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.