TEAM HERALD
NEW DELHI: Finance Minister Arun Jaitley on Thursday slashed export duty on the low-grade iron ore produced in Goa from 30 to 10 per cent, citing representations from the Goa iron ore industry.
The new duty rate applicable to the ore with less than 58 per cent iron content will be effective from June 1, Jaitley said while replying to the debate on the Finance Bill. He noted that the iron ore industry in Goa has been already hit because of the long-drawn stoppage of ore production.
BJP MP Narendra Sawaikar welcomed the move saying, “All the issues regarding mining have been cleared like ECs, transportation, issue of leases and finally export duty on iron ore as grade of iron ore in Goa is less than 58%. Parrikar (Union Defence Minister Manohar Parrikar) and myself went to demand this reduction (from Jaitley). We have been pursuing this issue even earlier,” he said.
Asked when he expected mining to start, he said: “I expect mining activity to start somewhere in September or October. It cannot start before the monsoon because there is hardly a month to go.”
Meanwhile, in Parliament, Jaitley said that the previous government had raised the duty on the iron ore as such to enable enough raw material for the Indian steel mills without realising that the low-grade ore produced in Goa is not usable by them as they do not have the necessary technology. “The duty on the better quality ore, however, remains the same 30 per cent,” he said.
Steel and Mines Minister Narendra Singh Tomar had indicated in February that the excise duty will be slashed by Jaitley on February 28 while presenting the Union Budget but that did not happen. The industry lobbied, with advertisements in Delhi newspapers by South Goa Truck Owners’ Association, early this month, resulting in Jaitley ultimately yielding.
The decision to lower the export duty will come into force only from June 1 at the fag end of the season and as such, the benefits may accrue to the Goan industry only in the next season from October.
It is to be seen if the Goan exporters will be able to re-attract the Chinese companies which were their prime buyers since most of them have shifted to higher quality ore now available at low prices since stoppage of exports with the Supreme Court clamping stay on mining in October 2012.
Though the Supreme Court had lifted the ban on April 21 last year, the iron ore production did not pick up in the last one year since the high export duty prevented any business from the international buyers who were able to get high quality iron ore from other countries.
