The recent gazette notification of the Odisha government to reserve at least 50%of Iron ore lumps and fines produced in the mines for the stand alone state based industries, has come as a relief to these units, but leaves them with several unanswered questions.
On one hand, steel industry welcomes this move by the state government, but on the other they question on price discovery mechanism, which is based on IBM monthly prices.
“There is ambiguity on deciding prices of Iron ore. IBM prices are determined on royalty returns submitted by miners. We will collectively make a representation to the government on possible modification in the mechanism. Let us wait till 7 Jul, 2014 when FIMI’s review petition on HC order will be heard,” said Mr. PL Kandoi, President of All Odisha Steel Federation.
On 2 Apr, 2014 the Odisha High Court, which had upheld the state government‘s directive of 5 Dec, 2012 to allot at least 50% Iron ore to steel industries having no captive mines, had called for a mechanism to ensure this within 3 months. Later, Federation of Indian Mineral Industries (FIMI, a representative body of miners) had filed a review petition in the High Court in mid-April.
R K Sharma, Secretary- general at FIMI remarked, “Depending on what the High Court decides on 07 Jul, 2014 for the review petition filed, we would take a further step whether to challenge HC order or state government’s mechanism in the Supreme Court.
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