A section of the engineering units here have appealed to the State government to not shut down the Sterlite plant at Thoothukudi permanently as copper prices have increased manifold in the last few months.
The Coimbatore Compressor Industries Association and Railway Suppliers Association said copper prices on March 22 last year were ₹380 a kg and shot up to ₹712 a kg now. In February this year, the prices had seen 21 % hike and there was a threat of further increase. In Coimbatore, there were nearly 1,000 manufacturers of pumps and motors. Enamelled copper wire was one of the essential raw materials for these units. The cost of copper was approximately 20 % in the price of a small electric motor. It had increased to 33 % now. The manufacturers could not pass on this cost.
Refined copper imports had increased 120 % in 2018-19 compared to the previous year. In 2019-20, nearly one lakh tonne was imported. Meanwhile, indigenous production came down 50 % in 2018-19. Hence, the Central government should abolish Customs Duty on copper scrap. The 2.5 % reduction announced in the Union Budget would not help the MSMEs. The State government should reconsider its decision to permanently shut down the Sterlite plant. The government should come out with strict safety provisions so that environment safety and public health were not affected. Increase in indigenous copper production would shield the small units from high raw material prices.
The government should also introduce dual price policy to major copper producing plants, the associations said.