NEW DELHI, India - The Indian governments budget for fiscal 1998-99 provides protection for domestic primary aluminum producers with an additional 8-percent custom duty on nonferrous metals.

The budget, released by finance minister Yashwant Sinha this week, will boost the import tariff to 33 percent, benefiting such ingot manufacturers as Hindalco, National Aluminium Co. (Nalco) and Bharat Aluminium Co. (Balco).

Aluminium Association of India officials said that with increased production, the primary aluminum producers will be able to market their products more effectively and will find it easier to meet Indian demand for primary aluminum.

But the budget is not favorable to producers of secondary aluminum such as Indian Aluminium Co. Ltd. (Indal). The import tariff structure for ingots, downstream products, extrusions, foils and scrap remains at 25 percent.

Indal managing director Tapan Mitra said the new budget has not given relief to the secondary aluminum industry, which is facing tremendous pressure from demand constraints and competition from cheaper fabricated aluminum products. He said the industry had expected the government to increase the customs duty to 30 percent on aluminum sheet, foil and other extruded products.