Facebook X-twitter Linkedin Instagram Youtube
Global Advisory firm, international consulting firm in India, business operations in India, india business strategy
Read Time: 6 min

Market Reports

Aluminium Industry in India

Market Report - Aluminium Industry in India

1

Quick Facts: Aluminium Industry in India

2

Overview: India’s Aluminium Industry

3

Aluminium Production Chain Analysis

4

Major Industry Players in Indian Aluminium Market

5

Government Initiatives Outlook

6

Megatrends in Aluminium Industry

7

Why invest in India?

Quick Fact: Aluminium Industry in India

  • India is the second-largest aluminium producer in the world
  • In terms of volume, aluminium ranks as the world’s second-largest metal market, following steel
  • According to industry estimates, India’s per capita aluminium consumption remains approximately 2.2 kg per year, significantly lower than the global average of 8 kg
  • The aluminium industry is power-intensive, which makes up 30 to 35% of the total production cost
  • In the domestic market, around 48% of the aluminium is consumed in the power transmission and distribution sector
  • India’s aluminium consumption has grown at a CAGR of 8% in the last 5 years
  • By 2030, demand in India is estimated to be 8.3 million tons, up from 4.5 million tons in 2024
  • In FY2024, India imported aluminium worth approximately INR 568.3 billion
  • India’s aluminium exports to Asia increased from 44% in FY2023 to 58% in FY2024, showing a strong shift towards the Asian market
  • Odisha, Chhattisgarh, Madhya Pradesh, and Uttar Pradesh are the leading states in India in terms of aluminium production capacity

Overview: India’s Aluminium Industry

Aluminium production begins with alumina, which is derived from bauxite ore. Typically, around 3 to 3.5 tons of bauxite are required to produce 1 ton of alumina, and approximately 2 tons of alumina are needed to produce 1 ton of aluminium. India’s aluminium industry holds a strategically advantageous position globally and ranks among the largest producers worldwide, backed by strong growth plans and promising future prospects. A key strength of the industry is India’s abundant bauxite reserves, providing a competitive edge over many other countries.

India has also been a pioneer in substituting copper with aluminium in power transmission and distribution, significantly boosting aluminium demand. The country houses nearly 600 cable and conductor manufacturing units, collectively capable of producing around 400,000 tons per year. The primary forms in which aluminium is used include rolled sheets, extrusions, and foils. Major players in the extrusion and foil market include Jindal Aluminium Limited, Century Extrusion, Myra Foils Private Limited, and many others. The sectors expected to drive aluminium consumption in India are automotive, power, electronics, railways, aerospace and defence, construction, solar energy, and packaging.

Key demand sectors for aluminium in India are power, packaging, transport, construction, and machinery and equipment. Aluminium consumption is predominantly concentrated in the electrical sector, accounting for 48% of total use, followed by automobile and transport (15%), construction (13%), consumer durables (7%), machinery and equipment (7%), packaging (4%), and other sectors making up the remaining 6%.

Sector-wise Aluminium Consumption in 2024

Aluminium Production Chain Analysis

The Aluminium production chain can be divided into upper and lower reaches, connecting a complete industrial value chain.

Upstream involves the extraction and preparation of raw materials to produce primary aluminium metal. It begins with mining bauxite ore, which is then refined into alumina (aluminium oxide). Alumina undergoes smelting through an energy-intensive electrolytic process to produce pure aluminium metal. In India, this upstream segment is well established, with abundant bauxite reserves located in states like Odisha, Gujarat, and Jharkhand.

Downstream refers to processing the primary aluminium metal into semi-finished and finished products such as aluminium sheets, foils, extrusions, wires, and castings. These products are then used in various industries including automotive, packaging, construction, and electrical equipment manufacturing. India’s downstream aluminium sector is growing steadily, supported by rising demand for lightweight and corrosion-resistant materials in transportation and infrastructure. Several Indian companies focus on producing high-quality aluminium products catering to these industries.

Major Industry Players in Indian Aluminium Market

Bharat Aluminium Co. Ltd. (BALCO)

  • Originally a public sector undertaking, BALCO’s ownership changed in 2001 when the Government of India sold 51% of its shares to Sterlite Industries (now Vedanta Limited).
  • BALCO is now part of Vedanta Limited’s Aluminium Business division.
  • The revenue from India operations for FY 2024-25 was INR 148.3 Bn.

Vedanta Ltd.

  • Vedanta Ltd. is one of the largest private-sector aluminium producers in India.
  • Vedanta owns bauxite mines in Kawardha and Mainpat in Chhattisgarh, which have a combined capacity of 2 MT.
  • The company operates aluminium smelters in Jharsuguda, Odisha and the other in Korba, Chhattisgarh (BALCO). Together, they have a combined production capacity of 2.4 MTPA.

Hindustan Aluminium Co. Ltd. (HINDALCO)

  • Hindalco is Asia’s one of prominent producer of primary aluminium and, together with its subsidiary Novelis, forms the world’s largest aluminium rolling and recycling company.
  • The company owns 27 bauxite mines across Jharkhand, Odisha, Chhattisgarh, and Maharashtra.
  • Hindalco’s aluminium smelters produce 1.3 million tons of primary aluminium annually, and it leads the downstream aluminium market with a production capacity exceeding 0.4 million tons.
  • The revenue for FY 2023-24 was INR 2,159.6 Bn.

National Aluminium Co. Ltd. (NALCO)

  • A company classified under the Schedule ‘A’ category of CPSEs and is one of India’s largest integrated bauxite, alumina, aluminium, and power complexes. The Indian government currently holds a 51.28% equity stake in the company.
  • The company operates captive Panchpatmali Bauxite Mines to support its alumina refinery located at Damanjodi in Koraput district, Odisha.
  • NALCO’s facilities include a 6.8 Mn tons per annum (TPA) bauxite mine, a 2.1 million TPA alumina refinery at Damanjodi, a 460,000 TPA aluminium smelter, and a 1200 MW captive power plant at Angul, Odisha.
  • The revenue for FY 2023-24 was INR 131.4 Bn.
Capacity and Production of Primary Aluminium for FY 2023-24

Government Initiatives Outlook

The National Mineral Policy 2019

  • The National Mineral Policy aims to ensure the systematic and sustainable development of mineral resources in India while balancing economic growth with environmental protection.
  • It promotes transparent and efficient allocation of mineral resources through auctions and encourages private sector participation and investment in the mining sector.
  • The policy emphasizes the importance of technology adoption, infrastructure development, and community welfare to boost the mining sector’s productivity and social responsibility.

Higher Aluminium Import Duties

  • The Aluminium Association of India (AAI) has submitted a major pre-budget proposal to the government aimed at strengthening the domestic aluminium industry, which it considers vital for national development.
  • The proposal requests raising import duties on both primary and downstream aluminium products from 7.5% to 10%, signalling a significant shift in India’s industrial policy to protect local manufacturers.
  • It also emphasizes environmental priorities by advocating for policies that encourage domestic aluminium scrap recycling while restricting the import of low-quality foreign scrap, supporting India’s goals for sustainability and a circular economy.

National Critical Mineral Mission (NCMM) (FY 2024-25 to FY 2030-31)

  • Aims to secure a sustainable supply of critical minerals by strengthening India’s entire value chain from exploration and mining to processing and recycling, ensuring availability from both domestic and international sources.
  • It focuses on enhancing technology, regulation, and financial support to promote innovation, skill development, and global competitiveness in critical mineral industries, including setting up Critical Mineral Processing Parks.
  • The mission empowers Central Public Sector Undertakings (PSUs) and their subsidiaries to invest in and acquire critical mineral assets abroad, supported by an Empowered Committee providing inter-ministerial guidance and necessary investment guidelines.

Aluminium and Aluminium Alloy Products (Quality Control) Order, 2025

  • The Ministry of Commerce and Industry (Department for Promotion of Industry and Internal Trade) has issued the Aluminium and Aluminium Alloy Products (Quality Control) Order, 2025, which requires 17 categories of aluminium products to comply with Indian Standards and display the BIS Standard Mark under a valid license.
  • For all manufacturers except micro and small enterprises, the order will come into effect from 1st October 2025.
  • Micro enterprises must comply by 1st April 2026, while small enterprises have until 1st January 2026 to meet the new quality standards.

Megatrends in the Aluminium Industry

Green Transition and Sustainability

  • India’s aluminium producers, including Vedanta and Hindalco, are shifting away from coal-based power generation. Vedanta plans to increase its renewable energy share to 30% by 2030, up from nearly 5% currently.
  • Increasing demand for low-carbon and recycled aluminium in both domestic and export markets.
  • Government policies promoting decarbonization and circular economy (e.g., Extended Producer Responsibility – EPR).

Automotive and Electric Vehicles Demand

  • The growing focus on lightweight vehicles to meet stricter fuel efficiency and emission standards is driving increased aluminium consumption in the automotive sector.
  • Aluminium’s growing role in EV manufacturing for battery enclosures, body frames, and components.
  • Government EV push (e.g., FAME II) indirectly driving demand for aluminium.

Infrastructure and Urbanization

  • Rapid urbanization and government initiatives like smart city projects and affordable housing schemes are boosting demand for aluminium in construction.
  • Aluminium’s use in window frames, roofing, and façade systems is becoming increasingly important as infrastructure development accelerates.

Why Invest in India?

Strong Resource Base and Integrated Value Chain

  • India has abundant bauxite reserves, the primary raw material for aluminium, especially in Odisha and Jharkhand.
  • Presence of integrated producers (e.g., Hindalco, NALCO, Vedanta) with mining, refining, and smelting operations.
  • Well-established secondary aluminium ecosystem, with growing recycling and scrap-processing infrastructure.
  • Competitive advantages in labour costs and access to raw materials domestically.

Growing Domestic Demand and Sectoral Growth

  • Rapid expansion in automotive, construction, renewable energy, and packaging sectors is driving aluminium demand.
  • Government schemes like PM Gati Shakti, Make in India, and Production Linked Incentive (PLI) are supporting aluminium-intensive sectors.
  • High potential in downstream industries like extrusions, rolled products, and foils.

Export Potential and Strategic Location

  • India’s geographical advantage makes it a natural hub for aluminium exports to Asia, Middle East, and Africa.
  • Steady increase in export share to Asian countries, with FTAs opening more access.
  • Globally cost-competitive production due to backwards integration and economies of scale.
  • Established ports and logistics infrastructure.

Government Support and Policy Push

  • 100% FDI is allowed in the mining and metallurgical sectors through the automatic route.
  • Government is promoting sustainable aluminium production through energy transition policies and incentives.
  • Ease of Doing Business reforms and industrial corridors enabling faster project execution.
  • Supportive policies for secondary aluminium and circular economy initiatives.

Our Team

Meet Our Experts
Our Team
Download PDF

Follow us

Facebook X-twitter Linkedin Instagram Youtube
UJA the best business consulting firm
Copyright © 2025 UJA. All rights reserved. Disclaimer: The site is not intended to be a source of advertising or solicitation. By visiting this site, you acknowledge that you are doing so voluntarily and of your own free will. You should not consider the information on the site to be an invitation for an Auditor / Advisor – Client relationship and transmission, receipt or use of the site does not constitute or create an Auditor / Advisor – Client relationship. All site contents are the copyright of UJA.

Download PDF