The high price of aluminium has restricted the consumption of the metal in the country at a mere 0.5 kg per capita over the years.

Recycled aluminium is still of restricted use in the country in contrast to most countries which use recycled aluminium on a regular basis.

It is estimated that 35 per cent of the requirement of metal in the world is met by recycled or reclaimed metal. Recycled aluminium forms 41 and 30 per cent of the total aluminium consumption in Italy and Japan respectively. In UK and Germany, recycled aluminium accounts for 25 per cent of the metal consumption.

As industry watchers put it recycled aluminium in no way interferes with the use of the primary metal as the former is primarily used for higher grades of products. In fact, at times, high purity aluminium is mixed with alloys to produce certaingrades of the metal.

An industry study points out that recycled aluminium is said to be have large benefits in terms of a saving on capital requirement, energy and foreign exchange for aluminium companies. It is environmentally benign and requires approximately an investment of $500 per tonne installed compared with $5000 per tonne installed for primary metal.

A cost benefit analysis shows that the aluminium industry could have made a potential saving of almost Rs 250 crore on a reduced import duty on scrap aluminium for recycling purposes from an average 25 kilo tonne per annum unit. Aluminium scrap recycling requires 5 per cent of the energy required for primary smelting purposes, which is phenomenally lower given the high use of power for smelting in the aluminium industry.

It is estimated that approximately 25,000 tonnes of sheet applications and 40,000 tonnes of extrusion applications today can be better served with recycled aluminium without any effect on the quality, says an industry watcher. Thescale of a modern aluminium scrap recycling plant is about 25,000 tonnes per annum and upwards, whereas the minimum scale for modern aluminium smelters is 2,40,000 tonnes per annum, industry estimates reveal.

But an inherent problem is that domestic scrap is not segregated and suitable for recycling. Hence, the need of import of scrap under a price band happens to be an obvious choice, said an industry expert.