AHMEDABAD, GUJARAT | 25th SEPTEMBER 2026 | The Cable and Conductor Manufacturers Association of India (CACMAI) and the Aluminium Secondary Manufacturers Association (ASMA) have urged the Government of India to rationalise the basic customs duty on primary aluminium, stating that the current duty structure is adding to cost pressures for downstream micro, small and medium enterprises (MSMEs).
The associations said supporting downstream aluminium ecosystem is critical to strengthening the states’ manufacturing base and contributing to the broader Viksit Bharat @2047 objective.
Duty burden adding to pressure on downstream MSMEs
Primary aluminium currently attracts a 7.5% basic customs duty, along with a 10% social welfare surcharge on the duty, resulting in an effective customs duty of 8.25%. ASMA noted that domestic primary aluminium is generally priced with reference to international and import-parity prices. Consequently, downstream manufacturers can bear the impact of the duty even when sourcing aluminium domestically. For several aluminium-intensive applications, aluminium accounts for 60–80% of total input costs.
The pressure has intensified with the sharp rise in global aluminium prices, with LME prices increasing from around US$2,200 per tonne to over US$3,700 per tonne, while several input costs have risen by 20–35% over the past three months.
The associations also pointed to the 2025 Ministry of Mines Aluminium Vision Document, which recognises the need to promote greater domestic value addition and strengthen India’s downstream aluminium ecosystem.
Gujarat’s downstream aluminium ecosystem
CACMAI highlighted that Gujarat hosts a significant downstream aluminium manufacturing ecosystem spanning Rajkot, Ahmedabad, Vadodara, Surat and Morbi. The ecosystem includes nearly 100 aluminium extrusion units, along with foundries, component manufacturers and other downstream processors serving sectors including automobiles, engineering, machinery, construction, power, renewable energy and consumer products.
These MSMEs play an important role in converting primary aluminium into higher-value products and components, supporting employment, domestic value addition and manufacturing competitiveness.
Associations seek a calibrated policy response
ASMA and CACMAI have called for rationalisation of the basic customs duty on primary aluminium, along with measures to address inverted duty structures and ensure that downstream manufacturers can access raw materials at internationally competitive prices.
Mr. Sanjay Saboo, President, CACMAI, said: “Aluminium is the principal raw material for cables and conductors and is priced with reference to international and import-parity rates, even when produced domestically. Rationalising the present 7.5% basic customs duty would help Indian manufacturers access aluminium at globally competitive prices and strengthen the competitiveness of the downstream value chain.”
Mr. Anil Agarwal, Patron, ASMA, said: “The Ministry of Mines’ Vision Document recognises the importance of maximising value addition in India’s aluminium industry. A calibrated reduction in the duty burden can help ensure that downstream MSMEs are not disadvantaged by raw-material costs, while supporting employment, investment and greater value addition”.
They also highlighted the need to examine duty differentials arising from India’s Free Trade Agreements, under which certain finished aluminium products may enter India at lower effective duties than those applicable to raw materials used by domestic manufacturers.
The associations stressed that a more competitive raw-material regime would strengthen MSME resilience, domestic value addition, employment generation, exports and Gujarat’s manufacturing clusters.
== ENDS ==
