Duty waiver fails to cheer iron ore exporters

Mining industry body says exemption would incentivise exporters from Goa

The cut in export duty on low grade iron ore lumps and fines (Fe content less than 58%) has not perked up exporters. Federation of Indian Mineral Industries (Fimi), a premier body of the mining industry, feels the duty cut announced in the Budget would at best incentivise exporters from Goa while leaving a large pool of exporters in the rest of the country untouched.

"The reduced export duty on low grade iron ore up to 58% may give some incentive to exports from Goa. But as far as rest of the country is concerned, it is not going to make exports viable in view of the present excess supply of iron ore in the world market and depressed prices," Fimi said in its response to the Budgetary announcement.

It may be noted that there is a huge stockpile of iron ore of 128.06 million tonne (MT) of iron ore- both lumps and fines at mine heads. While Odisha has a stockpile of 77 MT, Jharkhand has an ore stock of about 25 MT. Significant stock of the ore cannot be moved from Odisha since the state has a policy to reserve at least 50% of the iron ore output for the local industries.

Fimi, however, welcomed the move to slash export duty on chrome ore and chrome ore concentrates from 30% to nil, saying it would boost exports of the ore. Fimi had demanded the cut in export duty, citing that the country had a huge surplus of chrome ore and concentrates but it lacked commensurate demand in the domestic market.