The apex court order to restart mining in Karnataka may not provide immediate relief to the steel industry, as it will take at least 18 months to obtain statutory approvals, rating agency India Ratings, said.
Moreover, a few mines have to renew their mining leases as it had expired when the mining ban was in force.
Last week, the Supreme Court lifted the mining ban on Karnataka’s category-B (with moderate irregularities) iron ore mines. In 2011, the apex court banned iron ore mining in Bellary, Chitradurga and Tumkur districts of Karnataka, due to rampant illegal mining.
The court asked the Central Empowered Committee to carry out an environmental impact assessment.
On September 3, 2012, the ban was partially lifted and permission was given to 18 mines in category A to start operations after fulfilling certain conditions laid by the CEC.
The category-A and -B mines are estimated to produce about 25 million tonnes (mt) of iron ore against the estimated requirement of 35 mt; this will provide some relief to those steelmakers and miners whose margins have shrunk in the past 12 months. The positive impact of mining in Karnataka will be reflected in JSW Steel, Kalyani Steel and Sesa Goa financial in FY’15, said India Ratings.
suresh.iyengar@thehindu.co.in