Scrapping import duty on metal waste, giving industry status, to do away with pre-shipment inspection Certificate (PSIC) and having a policy on recycled metal is what Metal Recycling Association of India (MRAI) expects from the government, either during this Budget or in the next couple of years.
"There is no difference in the end commodity made from primary metal or our secondary (recycled) metal. By way of recycling, we help in decreasing dependency on mines and other natural resources. Thus, all we are asking for is a level playing field by wanting 0% import duty, presently the levy varies from 2.5%-5% depending upon the scrap metal," said Sanjay Mehta, president of MRAI.
"In the global market, we cannot stand as a competitive market due to duties levied in India. Secondly, having PSIC and other document procedures to import metal scrap are totally impractical," said Arvind Jain, partner, Micro Metals.
MRAI opined that PSIC procedure is costing around Rs 1,200 crores to the Indian importers, whereas installing scanners at all the major Indian ports will cost the government around Rs 200 crores.
In India, metal recycling is Rs 75,000 crore industry and the annual import is around 55 lakh tonne of ferrous metal scrap, about 20 lakh tonne of stainless steel and alloy steel scrap and nearly 11 lakh million tonne of non-ferrous metal scrap.
On Friday, union minister of steel, Chaudhary Birender Singh released a KPMG report on what measures can be taken by the Union government to form a policy for scrapped metal.
Though the minister recognised the need for having a policy and to give secondary sector priority over the primary metal sector, he stopped short of making announcements due to Union Budget scheduled on February 1. However, he did drop a hint that PSIC may be discontinued soon.
"In the last eight months, government-owned MSTC Ltd and MRAI under the guidance of steel ministry, has drafted a recycling policy by KPMG and has already submitted it. An inter-ministerial task force defining a time frame to implement the recommendations of the report is now needed. I am hopeful that in a couple of years, there will be a lot of positive change from the government for the good of this sector," added Mehta.
Union government is also planning to scrap and recycle vehicles over 15 years old, in lieu of it the owners will stand to gain 5% of the vehicle price.
"The government with their end of life vehicle policy will help in bringing more recyclable scrap within India. Overall, collection and logistics is a challenge for our recycling industry as it is an unorganised sector," shared Rajat Agarwal, managing director, Gravita India Ltd.
If an industry status is accorded to this sector, it will be financially beneficial to raise more funds, or else, the firms within the sector continues to be categorised as micro, small and medium-sized enterprises. This will also give a fillip to the recycling rate in India vis-a-vis other countries as it is much lower compared to other countries like Germany, Sweden, Finland, Russia, Turkey, Australia and North America. In these countries, the average recycling rate is over 80%, while India's recycling rate is merely 20 to 25%.
Source: dnaindia.com