The union mines minister Dinsha Patel has admitted that high
export duty has impacted the overall iron ore production in the country. However,
he said that, an inter-ministerial committee would take the final call on the
issue of roll back.
“Something has happened …I think there is an impact on the
overall production of iron ore in the country due to high export duty. I have
written several times to the government for a roll back. However, the final
decision will be taken by the inter-ministerial committee consisting of representatives
from finance, Commerce and mines ministry†he said during his tour to
Bhubaneswar on Wednesday.
With a view to curb export and feed the growing demand of domestic
steel industry, the government had increased the export duty on iron ore from
10% to 30% in 2011-12.Before that it was increased from zero in FY09 to 5% (in case of
fines) in FY10 and then to 20 per cent
in FY11.
Indian iron ore production
is expected to fall by 40% to 100 million tonnes in 2012-13 as compared to 167
million tonnes 2011-12, which had also seen sharp decline from 208 million
tonnes produced in 2010-11.
India, had exported 33.1 million tons in the
first 11 months of 2012, for a mere 4.9 percent market share of China’s total
import, down from 11 percent in 2011. India’s share in iron ore exports to
China, the biggest importer of ore in the world today, have come down from 20
percent in 2007 to 11 percent in 2011, and further down to 8 percent in the
first half of 2012.
Due to high export duty and low international
iron ore price iron ore export from India has become less feasible and miners
in the country prefer to cut production. Also due to curb on mining in states like
Goa, Odisha and Karnatka the iron ore production has reduced drastically in the
country.
The Federation of Indian mineral industries
(FIMI) has already made a demand to reduce export duty on iron ore in the
upcoming budget. Especially the miner’s body as demanded the centre to cut
export duty on iron ore fines to 5%.
Reported by Tapan Moharana
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