Home BUSINESS India has untapped potential to be a market leader and bauxite exporter

India has untapped potential to be a market leader and bauxite exporter

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By R L Mohanty

India is favourably endowed with rich and almost inexhaustible resources of bauxite, which is the main raw material for the production of aluminium.  Most of the resources are concentrated in the East Coast Bauxite deposits in Odisha and Andhra Pradesh followed by other states like Madhya Pradesh, Gujarat, Chhattisgarh, Maharashtra and Jharkhand. India is not only self- sufficient in meeting its requirement but has huge potential to be a major player in the international bauxite market.

India is fortunate to have about 3,896 million tons of bauxite resources as on 1st April 2015 placing it 6th in the global rank by country. In view of the huge resources available in the country, there is a need to have optimal conservation of these bauxite deposits. While large capacity aluminium smelters have been commissioned for utilization of metallurgical grade of bauxites, but as such there are only very limited avenues for non-plant grade bauxite.

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One of the greatest concerns is the high incidence of export duty (15%) being charged on export of bauxite including Non-Plant-Grade bauxite which has made bauxite export unviable from Western India.  The quantum of exports of bauxite which peaked to 8.91 million tonnes in the year 2015-16, sharply declined to meagre 0.50 million tonnes during the year 2019-20.

Export of bauxite leads to generating direct and indirect employment and to the socio-economic development of local communities, stevedores and other related ancillary industry. Needless to say, this generates revenue to the exchequer in the form of royalties, port dues, and taxes besides contributing to earning of foreign exchange and helps in reducing the skewed trade deficits.

In case of the aluminium industry, India is the leading player globally, with 2nd largest aluminium production capacity and 3rd largest aluminium producer.  India has a significant primary aluminium capacity of 4.1 MTPA with the downstream processing capacity of 3.9 million tons, which lays a conducive platform for scaling up and leveraging our natural resources. Indian aluminium industry has made huge investments to the tune of Rs 1.2 lakh crore (US$20 billion) to enhance domestic production capacity from 2 MTPA to 4.1 MTPA to cater country’s growing aluminium demand.

The domestic consumption of aluminium is expected to reach 10 MT by 2031-32. To meet the future demand of aluminium, India needs to increase its bauxite production from 23 MT (in 2018-19) to 70 MT approximately (in 2031-32) and corresponding alumina production from 7.4 MT to 20 MT.

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However, despite having huge domestic demand and sufficient domestic aluminium capacity, 60% of India’s consumption is being imported, resulting in Forex Outgo of US$5.5 billion (Rs. 38,000 crores). Rising imports of aluminium need to be restricted in order to promote domestic production to realize the country’s vision for a self-reliant India.

Along with this, to facilitate the mining regime for bauxite, the allocation of coal blocks can be ensured to already operating the aluminium industry in the country.


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R L Mohanty is Vice President, Federation of India Mineral Industries (FIMI) and President, Eastern Zone Mining Association

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Taazakhabar News Bureau
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