Anglo-Australian mining giant Rio Tinto Plc has urged the
Indian government to remove import restrictions on boric acid,
which it said would relieve domestic industries currently
forced pay over the odds for domestically-produced product.
In a letter seen by IM from Vijay Ayer,
managing director of Rio Tinto India, sent in December to
India’s Secretary of Agriculture and Cooperation,
Shri Siraj Hussein, Rio reiterated a request that the
department remove the "discriminatory licencing regime" imposed
by the Central Insecticide Board (CIB) on the import of boric
acid.
Rio, which produces borate products through its Borax mine
in California, US, maintains that the existing import
restrictions are causing Indian industries that purchase boric
acid to pay a 20-30% premium on domestic product because it is
not subject to the licencing restrictions placed on
imports.
The letter was sent following a meeting between Ayer and
Hussein in mid-November to discuss the issue.
In it, Rio pointed to the fact that boric acid is subject to
a dual classification under India’s Import Tariff
Classification (ITC-HS). Under one section of the ITC, it is
considered "freely importable", while under another it is
defined as an insecticide and subject to various restrictions
under the Insecticides Act 1968.
As such, all imports of boric acid, regardless of end use,
require the importer to be registered and seek a specific
licence for shipments.
This creates a "marketing advantage for domestically
produced boric acid in that it can be delivered to customers
'on demand’", Rio said.
"Repealing the import restrictions will lower the cost of
boric acid to Indian manufacturers, increase the
competitiveness of a broad cross section of domestic industries
and therefore, serves India’s national interest,"
Ayer wrote.
Rio dismissed efforts that have been made by the CIB to
expedite the licencing process, maintaining that "even if the
regime is somewhat faster [it still] provides an unfair trading
advantage to [domestic boric acid producers]".
It also rejected the mooted justification for the policy on
health and safety grounds: "If the CIB has determined that
boric acid needs to be controlled for its use as an insecticide
in India, it should apply any restrictions on certain
substances without regard to whether the product is imported or
domestically produced."
The US – which exported 215,000 tonnes boric acid
worldwide last year, according to figures from the US
Geological Survey (USGS) – raised a complaint with the
World Trade Organization (WTO) on the issue in October
2015.
Boric acid is derived from boron, which in turn is extracted
from borate minerals such as borax and colemanite. It is widely
used in insecticides, flame retardants, construction chemicals
and the steel industry.