JD-U smells scam in export tax reduction on iron ore

New Delhi, May 24 (UNI) The Janata Dal (United) today alleged a scam in the sudden reduction in export tax on iron ore from Rs 300 per tonne to Rs 50 per tonne early this month, causing a Rs 1,000 crore loss to the exchequer.

Briefing newsmen here JD(U) party President Sharad Yadav said the suspicion of a scam could not be ruled out, as Finance Minister P Chidambaram too, who was in China on March 27 this year, had declared that the export tax on iron ore would not be withdrawn or slashed.

''What happened after the China visit which forced Mr Chidambaram to slash the rate of export duty, causing the loss of around Rs 1,000 crore to the natonal exchequer?,'' Mr Yadav questioned.

He said the Goverment must clarify why they were forced to backtrack this 'good decision' which was meant primarily to preserve the national wealth of iron ore and also to fetch money for the country.

He said the decision could have been taken under external pressure or there could be a 'scam' in this whole episode.

''Our domestic steel producers were keen on preserving this precious national Wealth, as no other large steel producers were engaged in the export of iron ore,'' Mr Yadav said.

Significantly, most of the iron ore export is headed for either China or Japan and they are ruling the global steel market by sourcing iron ore from India.

Mr Yadav said as a result of this decision a truck load of iron ore became cheaper than a truck load of soil normally sold within the country.

He said another important feature of this decision is that it would mostly benefit a particular type of low grade iron ore namely grade 62 which is normally exported from Goa region, where the state is currently under election mode.

The JD(U) President said he would write a letter in this regard to the Prime Minister Manmohan Singh so that the matter could be taken up for discussion at the May 28 meeting of the Group of Ministers of mineral sector and this decision could be reverted.

UNI