India has the potential to be self-sufficient and become a global manufacturing hub of aluminum, and can be a strong substitute to China. Analyse (200 Words)
Refer - Financial Express
Enrich the answer from other sources, if the question demands.
IAS Parliament 5 years
KEY POINTS
· Amid the ongoing slowdown, Covid-19 has pushed the world towards negative growth. IMF projects the global economy to contract by 3%.
· This will adversely impact the entire metal industry, especially the world’s second most important metal, aluminium.
· With a gloomy global forecast and Chinese smelters continuing operations, there will be an inventory glut. End-users are cancelling contracts for primary aluminium in Europe and North America, contracting demand by 5 mn tonnes.
· India’s GDP forecast falling to 2% (from 6%) will impact aluminium demand in the construction, transport, and electrical sectors. Aluminium demand will decelerate by 40-50% unless enough stimulus is given—an SOS call of the aluminium industry.
· Global recession, dumping from China, shrinking markets in the western hemisphere, and semi-finished products through FTA countries like Malaysia and Thailand spell trouble for Indian aluminium exports.
Aluminium is the most apt industry for creating livelihoods to achieve the coveted V-shaped recovery from ~2% to ~7% by next year.
· Industry, along with the government stimulus, should promote MSMEs and downstream industries. Aluminium parks developed by Nalco and Vedanta will increase value addition, mentor MSMEs, lending brand names to market end products.
· With all ingredients of competitive raw material availability (bauxite and coal), best-in-class manpower, and value addition through MSMEs, India has the potential to be self-sufficient and become a global manufacturing hub of aluminium, and can be a strong substitute to China.
