clipped from www.thehindu.comM. Ahiraj
BELLARY: The levy of export duty on iron ore at Rs. 300 a tonne in the latest budget has come as a shock to mine owners and ore exporters in Bellary district.
The quality rich iron ore being extracted in the Bellary-Sandur, Hospet-Sandur and Bellary-Hospet sector is very much in demand in the international market. Ever since there was a lot of demand for ore from China, production has gone up by three fold in the last six years. The district produces around 30 to 35 million tonnes of ore annually, of which around 70 to 80 per cent is exported to China, Japan and Australia.
The sector has been a major part of the economy of the district and has been providing direct and indirect employment to a large number of persons.
Rahul Baldota, President of the Organisation of Mine Owners Associations and one of the directors in the Hospet-based MSPL Ltd., a leading mining company, felt that the levy of export duty was a `retrograde' step.
"The Union Finance Minister says that the duty is imposed to conserve iron ore. The question is conservation for whom. As at present, only a third of the total ore produced in the country (around 50 million tonnes) is being consumed domestically. More over, 85 per cent of the ore exported from Bellary district is fines (powder) which is not purchased by the domestic steel industry as it prefers the ore in lump form. Such being the situation, the imposition of duty will only bring down ore exports drastically,'' he said while talking to The Hindu.
With almost all mining companies exporting the ore directly and having entered into agreements with foreign companies/agencies, they have no other alternative but to fulfil their commitment of supplying the ore.
Noor Ahmed, President of the Bellary-Hospet Sector Mine Owners' Association, said he was at a loss to understand why the export duty was imposed on fine ore.
He told The Hindu that the Federation of Indian Mining Industry (FIMI) has convened a meeting in New Delhi on March 7, to discuss the impact of the imposition of export duty and submit a memorandum to the Union Finance Minister to roll back the export duty. "The FIMI will also meet the Union Finance Minister and urge him to withdraw the export duty.''
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