Ever since India had instituted countrywide lockdown initially for three weeks starting March 25, which was further extended till May 3, almost all operations in factories came to a standstill. The metal recycling industry is set to lose Rs 22,000 crore to shipping companies and container freight stations (CFS), as the latter have not waived demurrage/detention charges during the nationwide lockdown period as directed by the Shipping Ministry, as per a report in Business Standard.

Due to the lockdown that started on March 25, almost all operations in factories came to halt. A large number of Indian buyers had imported scrap (shipped in containers) as raw material and these containers had started piling up at Indian ports. As per industry estimates, more than 250,000 containers with various metallic scrap have been stuck at different ports across India during this lockdown period. With the average detention charge pegged at Rs 15,000 per container for more than 60 days, the amount of detention/demurrage charged by the shipping lines will be more than Rs 22,000 crore only to the recycling industry.

“The Ministry of Shipping issued an order dated April 21, and Director General of Shipping on April 22, calling for a waiver of all charges at ports by shipping lines and CFSs/ICDs (inland container depots). However, many shipping lines, CFSs/ICDs continued to take such charges from importers. If not waived, metal scrap importers will lose Rs 22,000 crore on these charges. These charges work out to as much as Rs 80,000 crore for all importers of essential and non-essential commodities,” said Sanjay Mehta, President, Material Recycling Association of India (MRAI). In fact, the Shipping Ministry's order specifically mentions the waiver of all kinds of port charges during the entire lockdown period, and 30 days beyond.

The metal scrap recycling industry have urged the government to direct shipping companies and CFSs to enforce its orders immediately and waive all detention/demurrage charges for the entire lockdown period and one month of thereafter as directed. Also, there is an urgent need to declare recycling activity as ‘essential services’ in addition to additional sanctioning and waiver of on working capital. The metal recycling sector has also urged the government to grant subsidy of Rs 2/unit in electricity charge to help industry overcome the financial stress emerged after the Covid-19 pandemic.