Goa sponge iron making units hit as K'taka bans supply of ore

Panaji, Jun 21: At least six industrial units manufacturing sponge and pig iron in Goa have been hit after neighbouring Karnataka imposed ban on transport of iron ore, a key raw material for making sponge iron that the Goan companies source from Uttar Kannada.

District administration of Uttar Kannada, bordering Goa, through a notification clamped a ban on movement of iron ore outside the state on June 14 which will continue till September 30, 2011.

Goa Chamber of Commerce and Industry (GCCI) President Manguirish Pai Raiker told PTI that they have already started negotiations with the Karnataka government as in the absence of raw material, all six units would need to shut their shop.

"There is a mutual benefit involved in getting the raw material from Karnataka. The iron ore from Karnataka is processed at these plants in Goa and the sponge or pig iron is sent to steel plants in Karnataka, which is a raw material for them. We do value addition here and do not export it," Raiker explained.

GCCI has said that the restrictions should be lifted on the trucks which usually carry bare minimum ore required for the units in Goa.

The ore extracted in the mining rich belt of Hospet, Bellary, Chitradurga and Sandur regions is supplied to units in Goa. These units had consumed 9.96 lakh tonnes of ore during 2009-10 and 13 lakh tonnes in 2010-11. Incidentally, last year also a similar ban was imposed by Karnataka.

PTI