The industry is going through “unprecedented and the most challenging times that mankind has seen” and while one has to ensure the health and safety of their loved ones, it is also important that their businesses remain safe and survive the economic blow which COVID-19 has unleashed, said the Material Recycling Association of India (MRAI) in a general advisory for members of the trade.

The first aspect that the five-point advisory stressed on was the need for suppliers and buyers to abide by their contracts. Following are excerpts from the advisory:

As much as the world was not prepared for the large scale destruction this pandemic would bring, our businesses also remained exposed to several uncertainties and anxiety of what would come along. We at MRAI, which is India's apex organisation for recycling and secondary trade, are working around the clock with all stake holders, including government, importers, traders/agents etc., to minimise the economic impact of this unforeseen crisis. We are communicating daily with Customs, shipping lines, CFS, ports, transporters, etc. on various issues impacting the trade including unrestricted movement of our goods, so that production can gradually get back on its feet. 

The Indian Recycling Industry is largely dependent upon imports for its raw material needs. We are one of the biggest scrap processing and consuming countries in the world, helping our downstream industry with high quality, value added input resources. As a result, India has become an indispensable part of the global scrap chain network. As there are large number of international contracts in execution, it is MRAI’s endeavour to see them being honoured in entirety, without their getting into litigations.

In this regard, we would like to put forward our views as follows:

• Both sides i.e. suppliers and buyers (including agents) remain obliged to fulfill their contractual obligations.

• The disruption caused by the pandemic, may create hurdles towards smooth execution of contracts as services like Shipping, Transport, Banking, Courier companies, etc. get temporarily impaired or affected. While buyers and suppliers should remain compassionate, and mutually accommodate each other to the extent of disruption, they should not exploit situation for undue commercial gains. Successful completion of contracts needs to be endeavoured in intent, spirit and action.

• Whilst MRAI is in touch with Local, State and Central Government departments on daily basis to prevail upon on shipping lines & CFSs to extend free container detention period and port demurrage, for the lockdown period, plus a reasonable additional days to clear the back log - it would be also be requested of importers to push directly at destination ports (In India) - for liners and CFSs to give such relief.

• Suppliers and buyers need to cohesively work together in solving disputes, arising out of contract related issues viz., shipment delays, payment delays, etc. Whatever changes/negotiations/settlements are made in the original terms between contractual parties, they should be based on their own judgment. However, please note that decisions made today - will be the basis of future relationships. We at MRAI would urge the trade to take all necessary precautions when entering into contracts, including that of arbitration/mediation and legal jurisdictions thereof.

• It is urged that contractual parties discuss amongst themselves and solve contentious issues, if any. However, if unable to find solution, MRAI’s Mediation Committee can intervene on behalf of member companies - subject to all concerned parties unconditionally accepting to use this as a medium of settlement. In such case, all processes and costs must be agreed on, beforehand.

“Once again, these are very testing times for all of us. We must ensure that we remain united, and hand-hold each other to see this period through. Our industry has truly evolved and grown because of our camaraderie and hard work. Let’s ensure that this spirit prevails.”