Aluminium consumption in India to grow from 3.3 mt to 5.3 mt

Aluminium consumption in India is poised to grow from 3.3 million tonne (mt) in 2015-16 to 5.3 mt in 2020-21 riding on a host of government initiatives like, Make in India, Smart Cities, Housing for all, rural electrification, and freight corridors.

This was stated in a report titled “Indian Aluminium Industry: Geared for growth,” by Crisil, a global ratings, research, risk and policy advisory and Mtlexs. The report was launched at the World Non-Ferrous Conference 2016.

Primary demand for increased consumption is expected to come from the power sector, where aluminium is a cheaper, lightweight substitute for copper in transmission and distribution, the report said. Over the next five years, investments from state discoms and central government schemes totaling INR4.3 trillion are being planned to expand India’s transmission and distribution network.

Secondary demand for aluminium consumption will ride on the growth in the automotive sector. Stringent vehicular emission norms leading to manufacturers reducing vehicle curb weight have come as a boon to aluminium industry, which is now finding ever greater applications in the sector. As consumer sentiment improves, and expectations of faster economic growth hold sway, automobile demand has a very favorable growth outlook for the next five years.

Commenting on it, Suneel Mardia, CEO, Mtlexs said: “With a relatively low per capita electricity consumption, very low household penetration of cars, and India on a strong growth trajectory in the foreseeable future, there is significant headroom for growth in the aluminium industry.”

While the Indian aluminium story is linked to power and automotive sectors, which together take up nearly 60 per cent of the consumption pie, other sectors like consumer durables are also poised to grow at a very healthy rate, he added.

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