'Metals Recycling' looks to new policies as India strives towards 'Make in India'

23 February 2015

It is one of the neglected metals sectors in India. The metals recycling business suffers from government apathy and to some extent, even a lack of awareness on part of the various participants within the metals ecosystem. How else can one explain that India’s recycling rate is just about 25%, putting it at the bottom of the global list of recycling nations. In the US metals are recycled at a rate of 90%.

Slowly, though, realization is creeping in that recycling metal scrap is a must in the modern world since the nation’s carbon footprint reduction has become imperative.

The new Modi government in India is seen as proactive one has compelled the Metal Recycling Association of India (MRAI), a representative trade body,  to ask the federal government to frame and implement a Metal Recycling Policy and accord it “industry status.” This was also the underlying purpose of the recently-held 2015 Metal Recycling Association of India International Conference held in Mumbai.

This is the outline of what the attendees thought the Indian Government should boost scrap recycling:  Remove the basic import duty of 5% on steel scrap, give it industry status, subsidize lending rates, allow Foreign Direct Investment and increase financing facilities.

A Frost & Sullivan report on ‘Metals and Minerals Practice’ presented on the Indian metal recycling industry at the MRAI’s international conference, said the sector was currently at a nascent stage, highly unorganized and large volumes of unaccountable/non-segregated scrap are “inadequately utilized.” As a result, it said, there is more burden on primary production which is depleting India’s natural resources.

Due to recent government policy announcements, the Indian recycling industry got a much-needed wakeup call to convert large amounts of recycled metal scrap into secondary raw material. The report said India should actively promote organized scrap recycling clusters like developed countries, thus enabling it to conserve its natural resources and key utilities.

Take, for example, India’s burgeoning automobile market and how the recycling sector could benefit and add value to the economy. According to Mohan Agarwal of the Century Metal Recycling Pvt. Ltd, quoted by RecyclingToday, India has risen to become the seventh-largest automaker globally and the second-largest producer of two-wheeled motor vehicles (scooters and motorcycles). With this kind of industry growth, and the motor vehicle industry as a major customer, Century Metal Recycling had grew, in a mere nine years, to operate seven secondary aluminum and zinc alloy plants in India with a combined 225,000 metric tons of annual capacity.

That showed the inherent potential that the metals recycling sector held in India, extending across industries such as aluminum, stainless steel and even lead-acid batteries. Stainless steel factories in India, for example, use 53% scrap as feedstock, compared to 76% in the United States. All this could change if the government ushers in reforms in this sector. That is the overwhelming opinion of the players.