New Delhi, March 13: India today slapped safeguard duties on aluminium products to protect local industry from cheap Chinese imports.

The commerce ministry imposed a 35 per cent safeguard duty on aluminium sheets and a 22 per cent duty on aluminium foils.

Market leader Hindalco of the AV Birla group, Vedanta-run Balco and PSU firm Nalco had alleged dumping by the Chinese. Subsequently, the directorate-general of safeguards, customs and central excise had started a probe.

Hindalco has a 70 per cent share in flat-rolled aluminium and a 55 per cent share of the foils market.

A safeguard duty is a temporary tax on imports to protect local industry from predatory pricing. Government officials said the duty had been imposed for 200 days.

Aluminium foils are used in packaging, while the sheets are used by the automobile and the light engineering industries.

“The initiative by the government to impose safeguard duty on aluminium foils and sheets is quite important for the domestic industry,” said Balco CEO Gunjan Gupta.

Aluminium imports in April-December stood at 2,75,321 tonnes compared with 3,77,607 tonnes for the whole of the last fiscal.

In their petition to the government, the aluminium firms had spoken of declining monthly production and falling capacity utilisation in April-December.

Excluding the safeguard duty, the import duty on primary aluminium is 5 per cent, while it is 20 per cent on value-added items such as rolled products and foils.

Last month commerce secretary G. K. Pillai had said the country was exploring the possibility of a safeguard duty on aluminium.

The government had yesterday imposed a 20 per cent safeguard duty on PAN (pthallic anyhydride), a chemical used in plastics and dyes, for six months. India mainly imports PAN from South Korea, Taiwan and Indonesia.

Export barrier

India is also fighting the imposition of prohibitive duties on its manufactures by other countries.

The commerce ministry is in discussions with the Turkish government on measures taken by Istanbul against Indian cotton yarn.