Iron ore industry collapsing, says mines minister

Patel calls for an immediate rollback of export duty on fines

GN Bureau | September 17, 2012



Union Mines Minister Dinsha Patel is lobbying for the iron ore industry, citing wrong policies chocking their mines with huge dumps of unexported ore fines leading to "loss of not only customs duty to the Centre but also royalty revenue to the state governments."

In a letter to Finance Minister P Chidambaram, he has called for an immediate rollback of export duty on fines from 30 to 15 percent ad valorem and suitable rationalisation of the high rail tariffs "for restoring iron ore production," as measures to stop continuing fall in exports and space constraints forcing miners slash production.

He claims that the primary reason for decline in the production of iron ore impacting the domestic steel industry is the hike in customs duty and railway freight making exports unviable "resulting in piling up of ore at mine heads slowing down the production."

The one-page letter written last Thursday points out that fines constituted 61 percent of total production in 2010-11 and "due to the limitation on the area available for staking fines on their lease area, the miners are forced to reduce their overall production."

Patel's worry is over "increase in mine-head stocks from 88.8 million in 2010-11 to 104.2 million tonnes in 2011-12, adversely affecting the production of iron ore, including lumps for domestic market."

He attributes the crisis faced by the iron ore miners to very high export duty on fines which was raised from 5 percent ad valorem to 20 percent ad valorem in March last year and then 30 percent ad valorem in December, differential freight on export of iron ore and the decline of the international prices of iron ore.

Patel writes that this has substantially reduced the profitability of the iron ore export that fell drastically from 123.43 million tonnes in 2009-10 to just 47 million tonnes in 2011-12.

Comments

 

Other News

Gandhian movement after Gandhi failed: Ram Guha

The Gandhian movement in India, after Gandhi’s death, failed, says Ramachandra Guha, and blames Vinoba Bhave for it. But the movement found new, fertile grounds around the world and succeeded in bringing about a change in South Africa, the US and elsewhere. It is high time it returned home. Of cour

When religion, politics and Bollywood come together

Tavleen Singh, noted journalist and political commentator, has turned to fiction, with her debut novel ‘The Actor’ (HaperCollins India). Set in the near future, it has a superstar, Amit Singh, turning to politics, when the political landscape is dominated by prime minister Guru Gaynendraj

Cabinet approves setting up of Integrated Transport & Logistics Authority

The union cabinet, chaired by prime minister Narendra Modi, on Tuesday approved the setting up of a Special Purpose Vehicle (SPV), called Integrated Transport & Logistics Authority (ITLA), to strengthen research, planning, appraisal, monitoring and impact assessment within the broad domains of Transp

Why foundational literacy and numeracy is key to school education

Foundational Literacy and Numeracy (FLN) are often described as the building blocks of education. Yet, their significance goes well beyond a child’s ability to read a sentence, write a response or solve a basic mathematical problem. These foundational skills shape how children understand the world,

When police data becomes the algorithm

For decades, policing has followed a familiar sequence: a crime occurs, the police respond, an investigation produces records and those records become part of the institutional memory of the criminal justice system. Artificial intelligence is beginning to alter that sequence. Instead of merely recording

Before India voted, the framers worried about the referee

“We are making a Constitution forever and not only for today.” Shibban Lal Saksena said this in the Constituent Assembly on June 15, 1949. He was warning that a ruling party might one day choose a loyalist to run India’s elections. Seventy-seven years later, the Supreme Court is wrestli

Upcoming Conferences



-->

Archives

Current Issue

Opinion

Facebook Twitter Google Plus Linkedin Subscribe Newsletter

Twitter