India Plans Copper Mine Auctions In Two Years To Curb Imports

13 November 2017

India plans to auction copper mines in the Khetri region of Rajasthan over the next two years to reduce reliance on imports as consumption grows.

“Auctions will take place one-two years down the line… (the capacity) will be about 2-3 lakh tonnes of copper,” Mines Secretary Arun Kumar said today on the sidelines of an event in New Delhi. India is dependent on imported copper and is marginally vulnerable, he said.

The nation is the seventh largest producer of copper in the world and demand has grown since 2012 at an annualised rate of 6.7 percent. Consumption is about 20-23 million tonnes and 0.5 kg per capita, said JC Laddha, chief executive officer (copper), Hindalco Industries Ltd.

The demand largely comes from power, auto and electric vehicles, railways, consumer durables, solar energy and electronics sectors. “By 2025, electric vehicles will be almost 10 million, which means there will be an additional copper requirement globally of over 1.2 million tonnes,” said Laddha. Solar and wind power projects will also create an additional demand of about 5 million tonnes, he said.

To check rising imports, Laddha urged the government to reconsider Free Trade Agreements that lower barriers and raise customs duty for downstream products.

Kumar, when asked if his ministry plans to reconsider the FTAs, said there are conflicting views. “There has been an increase in imports which helps downstream producers become more competitive. There’s a need to find a balance.” Excessive imports need to be looked into but a healthy growth is not a concern, according to Kumar.

He also said the new mineral policy being drafted by the government to replace the 2008 framework for stricter curbs on illegal mining will be ready by Dec. 31.

Source: Bloomberg