The Finance Ministry may remove import duty on iron ore lumps, fines and pellets. If this happens, it will benefit steel companies such as Bhushan Steel and Essar Steel.
Iron ore imports at present attract a duty of 2.5 per cent. The industry had pitched for the removal of this duty in their pre-Budget submission, but that has not materialised so far.
“The Steel Ministry had written a letter seeking removal of the duty. It is under active consideration,†a senior Finance Ministry official said. The development assumes significance because the Supreme Court-imposed mining ban in Karnataka and Goa and the regulation of mining by the State Government in Odisha, which has severely affected the availability of iron ore for the steel companies.
As a result, few companies like Bhushan Steel and Essar Steel have been importing iron ore. “The quantum of imports is negligible compared to the domestic output, but it is not tracked,†said Mr R. K.Sharma, Secretary-General of Federation of Indian Mineral Industries (FIMI). “There is no shortage of resources or capacity, but the lack of outlet for fines through exports is also affecting the production of lumps,†Mr Sharma said.
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