EU drops aluminium scrap export duty to boost India trade deal

The European Union has scrapped its plan to impose an export duty on aluminium scrap, removing a significant friction point in the ongoing free trade agreement (FTA) negotiations with India. The decision shifts the EU's approach from a direct fiscal levy to the application of environmental regulations to monitor and manage the outflow of scrap metal. The reversal comes after sustained pressure from New Delhi and internal EU deliberations. For India, the duty would have increased the cost of importing secondary aluminium, impacting domestic smelters and manufacturers who rely on scrap as a cheaper, lower-carbon alternative to primary aluminium production. By abandoning the tax, the EU aims to clear a path toward finalizing the FTA by December. The shift in mechanism—from a trade duty to environmental standards—allows the EU to maintain its sustainability mandates without creating a financial barrier that could derail the broader trade deal.