Indian copper producers urge government to cut indirect tax to 5% from 18%
NEW DELHI: Indian copper producers have urged the government to reduce the indirect goods and services tax (GST) on copper products to 5% from 18%, arguing that the current rate locks up more than 490 billion rupees ($5.11 billion) in working capital. The petition by Bharat Metal Exchange (BME) and copper producers including Hindalco Industries, Vedanta Ltd, billionaire Gautam Adani’s Kutch…
Indian copper producers have called on the government to lower the indirect goods and services tax (GST) on copper products from 18% to 5%, according to a letter sent to the GST Council on September 22. The current tax rate, they argue, ties up over 490 billion rupees ($5.11 billion) in working capital due to the lengthy processing and conversion cycle, which typically lasts four to five months.
The high GST burden leaves little room for procuring raw materials and other business expenses when copper prices are on the rise. Producers have pledged 440 billion rupees in capital investment by 2030, which is expected to generate around 45,000 jobs. Copper prices on the London Metal Exchange reached a record high of $14,875 per metric ton earlier this month.
As the world's second-largest importer of refined copper, India may need to import 91% to 97% of its copper concentrates by 2047, according to government projections. Copper imports in the fiscal year 2025 increased by 4% to 1.2 million metric tons. Demand for copper is projected to surge to between 3 million and 3.3 million metric tons by 2030 and between 8.9 million and 9.8 million metric tons by 2047, as per government estimates.
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