The forging industry wants the Government to ban export of higher grade iron ore and instead encourage export of value-added products.

“China is the largest importer of iron from India. India is aiding the Chinese industry by sending public Indian wealth from our mines. Value-addition is done by China and they compete against us effectively,” rues Vidyashankar Krishnan, Managing Director, MM Forgings, and Core Member, Association of Indian Forging Industry.

India should export more value-added products (steel and forged steel parts), making our industry more competitive vis-à-vis other countries, says Krishnan, who has also been Convener, International Forging Congress - 2011.

The country exports 60 million tonnes of iron ore a year. “If a good portion of this were to hit Indian steelmakers, it would make India more competitive. This will bring also down prices of iron ore by Rs 2,000-3,000 a tonne and benefit all industries, including the forging industry.”

This will also make steel prices more competitive compared to international prices. “Compared to the lowest prices in the world, at any point of time, our prices are at least $30 a tonne higher.”

If not a blanket ban, the Government should levy at least a 30 per cent export duty on iron ore, says Krishnan.

The Government also needs to ensure transparency of steel prices by coming out with a steel index, says S. Muralishankar, Director – Technical, Super Auto Forge. This will protect both consumers and manufacturers.

Krishnan also urges a rollback of excise duty and service tax rates to 8 per cent, which were increased in the last two Budgets to 12 per cent. This will boost consumer demand and benefit the price-sensitive automobile industry, on which the forging industry is dependent.

The power-intensive forging industry wants the Government to encourage the power sector.

Section 80 I (A), which provides a tax holiday for power plants, expires by March 31. The industry wants the tax holiday to be made permanent to encourage investments in the power sector.

>swetha.kannan@thehindu.co.in

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