Aimed at discouraging iron ore exports, Finance Minister Pranab Mukherjee today proposed to levy 20% ad valorem duty on all types of outbound shipment of the key steel making raw material.
"Iron ore attracts an export duty of 15% in the case of lumps and 5% in the case of fines. This is a natural resource which needs to be conserved. I propose to enhance the rate of export duty for all types of iron ore and unify it at 20% ad valorem," Mukherjee said in his Budget 2011-12 speech.
Mukherjee, however, has also withdrawn export duty on iron ore pellets in order to encourage exports only after duly value-addition.
"Iron ore is also exported in a value-added, pelletised form. Full exemption from export duty is being provided to iron ore pellets to encourage the value addition process for fines," he said.
Iron ore exports from the country have declined by 30.62 per cent during July-December 2010 at 36.58 million tonnes (MT), compared to 52.73 MT exported during the same period in 2009-10.
Overall, India, which is the world's third largest iron ore exporter, produced 218 MT of iron ore in 2009-10 and exported almost half of it.
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