Profit and Gloss

Massive concealment of production and profits by the aluminium giants Hindalco and BALCO

A pot line for the smelting of aluminium. Analysis of information available in the public domain alongside official and internal documents on the operations of Hindalco and BALCO suggests that the companies may have concealed production worth around Rs 24,000 crore. Dhiraj Singh / Bloomberg / Getty Images
30 June, 2021


AT THE START of India’s struggle with the COVID-19 pandemic, the Aditya Birla Group and Vedanta Limited were among the first corporate donors to the PM CARES Fund—the emergency-relief fund helmed by Prime Minister Narendra Modi, which his government has shielded from all public scrutiny amid questions over how it has been managed and spent. Within the first week of the fund’s creation, in March 2020, the Aditya Birla Group gave Rs 400 crore and Vedanta gave Rs 200 crore. Both corporations were lauded in the media for their altruism.

Unbeknown to the public, JN Singh, a right-to-information activist, had tipped off multiple government agencies in December 2019 about massive concealment of aluminium production by Hindalco Industries, a part of the Aditya Birla Group, as well as the Bharat Aluminium Company, or BALCO, a subsidiary of Vedanta. Singh had evidence suggesting the two giant aluminium producers had failed to report hundreds of thousands of tonnes of output over extended periods, causing losses to the public exchequer worth thousands of crores of rupees. Analysis of information available in the public domain alongside documents furnished by Singh and other sources suggests that the two companies may have concealed production worth around Rs 24,000 crore.

Evidence of the consistent manipulation of figures in the daily pot-room production reports for Hindalco Industries’ aluminium facility in Renukoot, Uttar Pradesh, indicate massive and systemic underreporting of the company’s aluminium output between 1997–98 and 2016–17. Signs of undercounting and erasure are visible across a large share of the more than one hundred production reports accessed by The Caravan that span the two decades in question. Discrepancies in production data for Renukoot as reported by the local Central Excise and Service Tax Division, the Indian Bureau of Mines and Hindalco itself indicate lapses in monitoring and oversight by the government agencies responsible. The gap between Renukoot’s reported production totals over the two decades and the facility’s publicly stated production capacity as of 1997 suggests potential concealment of more than 2 million tonnes of aluminium production, worth Rs 15,231 crore. Available documents also show unexplained discrepancies in Hindalco’s reporting of its output of vanadium sludge and gallium, both high-value by-products of aluminium manufacturing.