Goa miners flay Assocham, call steel industry ‘inefficient’


Criticising Assocham’s stand on the issue of iron ore export duty , miners in Goa today said the levy should not be a tool for subsidising “inefficient” domestic steel industry. “Assocham should present a rational picture. Export duty should not get imposed for the purpose of subsidy to the inefficient steel industry,” Goa Mineral Ore Exporters’

Association (GMOEA) spokesperson P K Mukherjee told PTI. Repeating the demand for reduction in duty on iron ore exports, Mukherjee, who is also the Managing Director of Sesa Goa, said that the levy should remain only on the lumps — the highest grade of the mineral and rare in nature.

GMOEA is an industry body for most of miners from Goa. On Sunday, Assocham in a statement had said it has cautioned the government that any move to roll back export duty on iron ore, as is the demand of the mining industry, would adversely impact the steel industry.

It had also said that the government must stay vigilant and not repeat the saga of illegal mining caused by unrestrained iron ore exports and interests of the steel industry should receive government’s attention as they are facing the crisis of the mineral.

However, Mukherjee said there is no economic logic to continue with the export duty on fines and lower grades (having iron content below 52 percent). “What grade of iron ore you want to conserve needs to be understood. Duty on lower grades of the mineral makes their export uneconomical and they remain at the mines. Keeping them there is not conservation but destruction,” he said.

Currently, a duty of 30 percent is levied on both types of iron ore — lumps and fines. Few months back, the Mines Ministry and miner’s apex body FIMI had also sought reduction in export duty on iron ore from the Finance Ministry.

Meanwhile, Federation of Indian Mineral Industries (FIMI) said during the April-November 2012, iron ore export from the country has plunged 62 percent to 15 million tonnes due to mining ban in some key producing states, curbs on shipments and higher duty and freight charges.

FIMI Secretary General R K Sharma has alleged that government had raised the export duty bowing down under pressure from the steel industry. According to Mukherjee, domestic steel manufacturers are taking a protective shield through export duty route to hide their inefficiencies and for not paying the market price as there is no dearth of iron ore in the country.

“If world steel producers can produce the most competitive steel even after importing at international prices, why Indian producers want an artificial subsidy through the protective environment of export duty.

“Why they not be buying (iron ore) at import parity price? Basically, you (steel industry) are trying to hide your own inefficiencies by asking for continuation of export duty,” he said, adding that he is “ready for an open debate” on it.

SOURCE MONEY CONTROL.COM

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