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Beleaguered iron ore exporters on Monday urged the Finance Minister, Mr Pranab Mukherjee, to roll back the increase in export duty on the raw material used in making steel.
The Budget 2011-12 has proposed a uniform 20 per cent export duty on categories of iron ores such as lumps and fines. Earlier, the lumps and fines attracted an export duty of 15 per cent and 5 per cent, respectively.
In a memorandum, the Federation of Indian Mineral Industries (FIMI) urged the Finance Minister to roll back the hike in export duty to pre-Budget levels. Stating that the iron ore industry has been adversely impacted, FIMI said that exports were no longer viable due to the duty hike and the recent increase in rail transportation charges.
Post-Budget, the spot prices of iron ore have dropped by about a tenth to $150 a tonne for the higher grades with 62-63 per cent iron content. Lower grades exported from Goa have suffered a steeper fall in prices, FIMI said.
The spectre of increase in export duty every time a Budget is presented leads to total upheaval in the industry, FIMI said. Other countries such as Australia, Brazil and South Africa take advantage at the cost of Indian exports. FIMI said that Indian iron ore industry is the highest taxed industry in the world with hardly any surplus left for exploration and mine development.
Iron ore exports in the April-January period of current fiscal have declined by about a fifth to 75 million tonnes against 91.7 mt in corresponding period last year.
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