New Delhi, Feb 21 (UNI) The Federation of Indian Mineral Industries (FIMI) has urged the government for total abolition of the export duty on iron ore saying any proposal to enhance this duty would adversely affect the growth of this industry.
Talking to newsmen, FIMI President R N Baldota said here today that world over mining is an independent industry and has created significant value in the local economy. Approximately, 75 per cent of the major iron ore producers are independent mining companies.
He said even large iron ore producing countries like Australia, Russia and Ukraine import iron ore for steel production to get the right blends and hence, better efficiencies for their steel plants.
States that have recognised mining is an independent industry have witnessed rapid economic growth, he added.
Mr Baldota said it is strange that the major domestic steel producers who do not purchase a single tonne of iron ore from the market advises the government on the tax structure of iron ore industry.
He said our main steel producers who produces the steel using iron ore from their captive mines and major chunk of coal from their own mines and claims to be cheapest steel producers in the world but they can not compete in the global market except in China. It is a contradiction in itself, he added.
He said iron ore, like any other commodity, has a cycle of its own and the export have already started to decline.
Responding to a question on whether they would be ready to sell their iron ore to the domestic market, FIMI said if there is demand, no body would like to take the hassle of exporting it if they have a ready market here itself, he quipped.
In response to another question of iron ore being a scarce resource in the country and that it should be conserved for the domestic steel industry, Mr Baldota said it is totally wrong.
He said the domestic resources were not been evaluated scientifically and if proper evaluation is carried out, it would establish that the domestic iron ore resource is sufficient to support the projected steep consumption of 200 million tonnes per annum for more than 200 years.
He said the higher profitability of iron ore miners is part of a normal industry cycle. Any increse in royalty and export duty will impede growth not just of iron ore industry but also the steel industry as a whole, he added.
He said a lot of canard is being circulated that mine owners are blending high grade iron ore with low grade to escape higher export duty to beguile and misguide the public against mining companies.
Blending of iron ore, as of any mineral, is part of normal business of consumption process. Steel companies who procure iron ore from various mines in different countries blend iron ore to make consistent feed for their blast furnace to derive best product, Mr Baldota said.
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