Nalco faced by domestic market challenges for alumina value-addition, says Mines Minister

India's state-owned integrated aluminium company National Aluminium Co. Ltd (Nalco) has been working on a strategy devised to add greater value to the alumina produced in-house; but a host of challenges is obstructing the PSU's way to attaining success in the transition- the domestic market being the major one. The country's Union Minister of Energy, Coal, Mines and New and Renewable Energy Piyush Goyal expressed concerned over these issues.

While addressing an industry congregation on Friday, last week, Goyal said he was shocked to learn that Nalco produced less than half the quantity of alumina produced by its other private-sector competitors from within the country, in a year. The domestic market is primarily responsible for this capacity lag, Goyal added.

“I made a study to understand why and I was taken aback by the fact that we are producing alumina, the raw materials for aluminium, in large volumes but exporting it to other countries instead of adding value in India and selling finished products,’’ he explained.

However, market was not the only impediment to Nalco's transition into greater value addition for its alumina; there were other factors as well. The aluminium producer, he thinks, has also been pressured to ship alumina abroad, Goyal explained. However, Odisha government has extended a helping hand to the PSU in reversing the trend. Such an emphasis on developing value-added mineral products manufacturing would help generate significant employment opportunities, he said.

The coal block auction undertaken earlier this year by the government will guarantee that the mineral rich state is able to garner a total revenue of INR700 billion from ten of its coal blocks, he said. Such funds can be and should be channelled into development spending.

It is high time that Odisha makes a steady transition from a net consumer to a net producer of key industrial minerals, and the state should use such proceeds to effectuate the transition, Goyal opined. Doing that would put the state in an advantageous position while negotiating with other states.

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