Indian Copper Producers Seek GST Cut Amid Record Prices

Indian copper producers are seeking a reduction in the Goods and Services Tax (GST) from 18% to 5%, citing record prices that have tied up working capital across the supply chain. The Indian Primary Copper Producers Association, led by President Rohit Pathak, is engaged in talks with the government to secure this tax break.

Copper has reached new highs this year, exceeding $14,700 per ton on the London Metal Exchange in September. This surge has exacerbated cost pressures in India, which relies heavily on imports following the 2018 shutdown of Vedanta Ltd.'s Sterlite smelter.

The increased prices have led to higher working-capital requirements for primary copper producers like Hindalco Industries Ltd., which operates on a three-month concentrate cycle. The upfront tax is borne by both primary producers and downstream manufacturers, locking up significant capital that could otherwise be invested in industry expansion.