Rising Copper Demand Fuels India’s Economic Growth
Strong demand from the building construction and infrastructure sectors continues to drive copper consumption in India, with these sectors seeing growth rates of 9.1% and 6.8%, respectively, in H1 FY2025, as per the latest GDP data. Copper cathode production in India increased by 8%, and net copper imports rose by 13% during the same period. Historically, building construction and infrastructure contribute about 43% of copper demand and approximately 11% to GDP. According to the International Copper Association India’s annual Copper Demand Study, copper demand in FY2024 grew by 13% year-on-year, reaching 1,700 kilotonnes (kt), driven by overall economic expansion. Post-pandemic, copper demand has increased at an average rate of 21% annually between FY2021 and FY2024.
Mr. Mayur Karmarkar, Managing Director of ICA India, noted that this growth aligns with India’s GDP trajectory, fueled by investments in public and private sectors, consumer spending, and progress in key industries like construction, infrastructure, transportation, industrial goods, and consumer products. However, despite the rising demand, India’s domestic copper production has remained stagnant in recent years due to the closure of Vedanta’s Tuticorin smelter. With only Hindalco’s smelter operating, domestic cathode production decreased by 7% in FY2024, largely due to plant maintenance in Q1 FY2024, while net cathode imports surged by 103%.
India generated 468 kt of end-of-life and process copper scrap, supplemented by an additional 192 kt of imported copper scrap in FY2024, with total secondary scrap supply rising by 15%. However, reliance on direct melting of scrap leads to inconsistent copper purity, raising concerns over quality, particularly in applications requiring high electrical conductivity. The Quality Control Order (QCO) for copper products is expected to address these quality challenges by ensuring compliance with strict standards.
Mr. Karmarkar also highlighted India’s potential to build a robust copper ecosystem, with the upcoming operationalization of Adani’s copper smelter in Q3 FY2025 and duty exemptions on copper concentrates and blister. These developments, combined with continued demand growth, position copper as a vital component in India’s technological and economic advancement.