Economy

Aluminium Industry Under Stress

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Why in news?

India’s aluminium extrusion industry is facing a downturn as construction firms switch to cheaper UPVC plastics and imports from ASEAN countries rise. Stakeholders raised these concerns in September 2025, citing the need for policy support.

Uses and importance of aluminium

Aluminium is a lightweight, corrosion‑resistant metal widely used in window frames, doors, roofs, kitchen utensils and automotive parts. It is also important for renewable energy systems such as solar panel frames and electrical wiring.

India’s aluminium industry

  • Capacity and utilisation: India has an installed extrusion capacity of about 3 million tonnes per year, but actual utilisation is only around 1.2 million tonnes.
  • Imports: India imports more than 1.5 million tonnes of extruded aluminium annually. The difference in prices and concessions under free trade agreements make imports attractive.
  • Per‑capita consumption: Indians consume roughly 4 kg of aluminium per person, far below the world average of 11 kg and levels in China (25 kg) and the United States (18 kg). Low domestic consumption constrains industry growth.

Raw material availability

India is endowed with large reserves of bauxite, the primary ore for aluminium. Major producing states include:

  • Odisha: The largest producer, with significant mines in districts such as Koraput, Kalahandi, Rayagada and Sundargarh.
  • Jharkhand: Deposits in Lohardaga, Gumla and Ranchi districts.
  • Gujarat: Reserves in Jamnagar, Kutch and Junagadh.
  • Chhattisgarh: Mines in Bilaspur and Durg on the Amarkantak plateau.
  • Maharashtra: Bauxite in the Kolhapur district.
  • Madhya Pradesh: Deposits in the Amarkantak plateau and the Maikala range.

Challenges and way forward

The shift to UPVC plastics, which are derived from crude oil, is undermining aluminium demand in construction. Additionally, duty‑free imports under certain Harmonised System of Nomenclature (HSN) codes make imported aluminium cheaper than domestic products. To revive the industry, manufacturers are calling for stricter quality standards and anti‑dumping duties. Boosting domestic consumption through infrastructure projects and promoting aluminium’s recyclability could also help.

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