Team Herald
PANJIM: The Mining Engineers Association of India (MEAI) Goa Chapter has urged the Union government to review and completely withdraw the 50 per cent export duty imposed on low-grade iron ore (below 58 per cent).
The Association claimed that the imposition of export duty will have far-reaching ramifications not only on the iron ore mining industry in Goa, but also it will impact all the iron ore mining operations across the country producing low-grade iron ore.
The MEAI Goa Chapter mentioned that the iron ore industry is already hit by several factors including a four-year-long mining stoppage in the State leading to the destruction of over three lakh livelihoods.
This export duty structure by the Government of India will further worsen the situation by forcing many low grades of iron ore and merchant pig iron producers to shut down their operations due to economic unviability of the operations, leading to job losses of the mining professionals and workforce engaged in such operations.
The MEAI expressed concern over the huge stockpiling of low-grade iron ore across all the mining operations in the country which is non-saleable domestically and won’t be economically feasible for exports due to the 50 per cent export duty.
The Association also highlighted that imposition of export duty to the tune of 50 per cent has made iron ore export unviable and is as good as an export ban. This has already led to a significant drop in iron ore prices across the country and has also reduced revenues accruing to State governments in the form of auction premium, royalty, DMF and NMET. Lower collection of these funds and levies will adversely impact the State revenues and socio-economic development activities in the peripheral areas of the iron ore mines.
MEAI Goa Chapter chairman Joseph Coelho said that imposition of export duty on iron ore especially low grade (below 58 per cent Fe) will not lead to any steel price reduction in the country since low-grade iron ore is not feasible for utilisation in the country’s domestic steel operations unlike other steel producing countries, which consumes low-grade iron ore below 58 per cent Fe grade.
“There is no domestic market for such low-grade iron ore and hence there is no option but to export this low-grade ore which is mainly in the form of fines,” he added.
According to Coelho, most of the integrated steel companies across the country meet their iron ore requirement from their captive mines and they also sell/export low-grade iron ore fines below 58 per cent Fe. There is no reason to restrict the export of low-grade iron ore which can earn massive foreign exchange and exchequer contribution for the country.
