India will commence price negotiations with Japan for export of iron ore by National Mineral Development Corporation (NMDC) in the next few weeks, with the iron ore miner recently receiving the draft Cabinet approval on the estimated quantity of ore exports for the next five-year period.
An Indian delegation, comprising senior officials from the Ministry of Commerce, Ministry of Steel, canalising agency MMTC and NMDC, will be participating in the price negotiations. The prices are fixed in line with the prices for Australian and Brazilian exports.
NMDC, which has been indicted by the Karnataka Lokayukta for under-invoicing its exports to Japan and South Korea between 2006-07 and 2009-10, has received approval to export 3.3 million tonnes of ore this fiscal, as part of the new five-year contract. The last contract expired on March 31, 2011.
On the Lokayukta’s report, Mr Rana Som, Chairman and Managing Director of NMDC, denied all the allegations made in the report, stating that it was a case of “misunderstanding (on the part of the Lokayukta)”. Exports prices had been pegged on long-term contracts, which are sometimes below the prevailing spot prices, and this in turn could have led to the doubts regarding under-invoicing, he said.
“There is no room for under-invoicing, as the export prices are fixed by a high-powered Indian delegation. Further, the exports are handled by MMTC,” he told media persons here on Monday.