Profile of a scrap metal business in Leh

As part of our endeavour to understand waste in Leh city, we planned a visit to the junkyards in the locality called Agling where we believed metal waste was sold and bought. On a sunny morning, we went to Agling with our camera and notebook and randomly entered one of the junkyards. The place went by the name Ibex Sale Corporation. A person came up to us asking what we were looking for, thinking us to be customers. We told of our purpose - not buying or selling but simply learning a bit about metal waste and taking pictures of it. His first response was, "What waste?" (Chi khimsa?). It seemed he was not able to understand what it was we were calling waste. Permission was given anyway, to photograph and ask him anything we pleased. It turned out that he, Mr. Ali Akbar, owned the place. We instantly felt at ease.

We strolled slowly identifying the various objects - disassembled vehicles, flattened out metal drums, broken furnitures, metal wires, utensils, plastic waste and electrical appliances. Most of the things seemed to be from the army. Our ignorance about the metal scrap business led us to think the army was getting rid of its discarded vehicles and machines by sending them to these junkyards. But we intended just an open chat with Mr. Ali Akbar to correct our misconception.

Mr. Ali Akbar began dealing in metal scrap in 2008, about 12 years ago. He worked in the army previously and ventured into this business only after retirement. Formal metal scrap dealing, he explained to us, happens through a company called MSTC (Metal Scrap Trade Corporation). It is a government enterprise which provides the service of disposing ferrous and non-ferrous scrap from Public Sector Undertakings (PSUs) and government departments including the Defence through e-auction and e-procurement [1]. Scrap dealers have to get registered with MSTC, upon which, they are issued a unique identification number. Dealers can log in to the MSTC e-auction website using this number, chose the items they want to purchase, make a bid for those items, pay online and procure the items from the warehouse where they are kept by producing the invoice. Mr. Ali Akbar showed us his Identity Card and an invoice of his latest purchase from the army in Ladakh.

It is not an easy business, Mr. Ali Akbar says. Profit and loss cannot be predicted, not even detected. Some 80 lac INR of his is currently stuck in the market. So one just has to go on in the business without thinking too much about loss or gain. But business has never been very bad for Mr. Ali Akbar. He is able to employ upto ten staff paying a decent salary of 25-30,000 INR to each of them. On top of this, a rent of 3 lac INR is paid annually for the property on which the junkyard is situated. Heavy sums are also spent on transportation and GST (Goods and Services Tax).

Mr. Ali Akbar sells off his scrap to metal recyclers outside Ladakh. While we were looking around, a truck was being loaded, bound for Jammu. Trucks are able to carry between 8-12 tonnes of metal depending on the volume. The destination of the metal is either Jammu or somewhere in Himachal Pradesh. A good year for Mr. Ali Akbar is one where he is able to sell 600-700 tonnes of materials. We asked him what the scope of metal recycling in Ladakh was: could we not have a plant of our own instead of trading away the valuables? He answered that for the recycling business to be viable, a plant needs a minimum of 50-100 tonnes of scrap metal per day, a quantity which is not produced in the Ladakh region.

Metal scrap business requires the dealer to be tough, Mr. Ali Akbar said. Many nights go without sleep since large sums of money are involved. Financial assistance is sometimes needed. Morale boosting is very important in order to be able to continue taking the risk. Mr. Ali Akbar's friend, who dropped in at the office while we were conversing, chipped in saying that Ali Akbar is the only scrap dealer who despite running a business thinks of doing good rather than just profiting. He gave a simple example that for an item of 12 INR, another scrap dealer would charge 24 INR, but Ali Akbar would agree for as less as 13 INR if he sees the customer really needs the thing.

Before leaving, we asked Mr. Ali Akbar for one last favour - to pose for a picture together with his friends. He did so gladly, and as we were walking out, checked with us if he had answered everything to our satisfaction and whether we were leaving happy. He had been so hospitable and candid with us, we could not have hoped for better. By the end of our visit, we understood that metal scrap business runs into crores of rupees. At some point, Mr. Ali Akbar remarked, as one knows the trade, that 'metal scrap is gold'. No wonder he had asked us, 'What waste?.' We had called his gold waste!

Notes: 1. To know more about MSTC, visit https://www.mstcindia.co.in/index.aspx.