With the union budget 2023-24 only a few weeks away, speculations are abound on which sectors will be focused upon in the coming budget. India’s energy consumption continues to be dependent on coal mining, and simultaneously, the mining, metallurgy and quarrying industries remain an important cog in India’s economic wheel.
In the recently published government estimates on India’s growth this fiscal, mining and quarrying industries have witnessed a slump. According to data released by National Statistical Office (NSO), Ministry of Statistics and Programme Implementation (MoSPI), the GVA (gross value added) at basic prices for mining and quarrying has dropped from 11.5 per cent in FY22 to 2.4 per cent in FY23.
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As we head closer towards the budget, there is a call for rationalisation of cess on coal. The hike in coal cess since 2010 has adversely impacted the Aluminium industry since coal lends a significant portion of input cost in the production of Aluminium. FICCI suggests getting rid of the high coal cess to support power-intensive industries.
Further, FICCI also recommends a restriction on Aluminium imports. This can be achieved by increasing the basic custom duty across Aluminium products. For Aluminium products, a rate hike from 10 to 12 per cent is suggested and for Aluminium and articles under chapter-76, tariff rate of basic custom duty is required to be increased from 10 per cent to 15 per cent.
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The restriction on Aluminium imports will also act as a deterrant to China who currently constitutes 85 per cent of the Aluminium imports to India.
