The Hindu Business Line : Goa mine owners upset over hike in iron ore export duty

‘Low grade ore is not used by the domestic steel industry and as such the argument in favour of duty as a deterrent against exports of national resources does not hold water.’

Our Bureau

Panaji, July 1

Goa’s private sector mining industry is upset over the recent increase in export duty on iron ore exports imposed by the Centre.

“The ad valorem export duty on iron ore at 15 per cent could result in 20-22 per cent decline in State’s annual iron ore exports,” said Mr Shivanand Salgaonkar, President of Goa Mineral Ore Exporters’ Association (GMOEA), a body representing iron ore exporters in the State.

Goan exporters export close to 33 million tonnes of local iron ore annually earning a gross collection of Rs 6,600 crore.

Addressing presspersons here on Monday, Mr Salgaonkar feared that a serious decline in iron ore exports of the State could have a negative effect on Goan economy in general and the mining industry in particular.

The industry has been grappling with pressures from environmental groups and villagers in the vicinity of mining areas of the State in recent times.

Mr P.K. Mukherjee of Sesa Goa and Mr Srinivas Dempo, Chairman of Dempo Mining group, were also present at the press conference which highlighted the need for the industry to seek relief from the increased export duty, which, according to them would amount to about Rs 800 per tonne on an average.

Contrary to this, the earlier duty at Rs 300 per tonne on high grade ore and Rs 50 on low grade ore would amount to 3 per cent.

Mr Salgaocar said that if the export duty was not withdrawn, it would make the exports economically unviable forcing iron ore producers to reduce or stop production and exports of low grades, leading to various socio-economic and environmental problems.

Mr Dempo said that the low grade ore is not used by the domestic steel industry and as such the argument in favour of duty as a deterrent against exports of national resources did not hold water.

Mr Salgaocar said that Goan mining industry had invested heavily in facilities for beneficiation (mineral dressing process) technologies to upgrade the domestic ore deposits for export, which otherwise would not have had any market. He also said that there was demand for low-grade ore, especially from China, only in recent years, which otherwise remained unconsumed.

Mr Mukherjee wondered why the iron ore industry was being singled out for taxation and burdened with additional duty every now and then. He added that regulatory atmosphere could create problems for the mining industry, which had toiled to enter into long contracts to ensure exports of otherwise rejected ore.

According to mining industry, around 12,000 people are directly employed in the industry while 30,000 others are indirectly dependent on it.

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