The plant produced 46 percent of India's copper demand. A permanent shut down will squeeze domestic supply for the next two months.
The closure of the Sterlite Copper plant in Thoothukudi (Tuticorin), Tamil Nadu, would increase domestic supply crunch and may turn India into a net importer of primary copper, according to a Cogencis report.
On Monday, the state government ordered a permanent closure of the plant, which accounted for nearly half of India’s total copper supply. The shutdown was ordered after violent protests broke out in Thoothukudi against alleged environmental pollution caused by the unit. Around 13 people were killed in police firing.
India produces about 8,70,000 tonne of primary copper in FY18, of which 46 percent came from the Vedanta Resources-owned Sterlite plant alone.
While the copper plant has been shut down since March 27 for maintenance, a permanent shut down is likely to squeeze domestic supply for the next two months, the report said.