Aggrieved at the reported move by the government to hike the export duty on iron ore by five per cent, the mining industry today said the government stands to lose on such moves and it can even ban the shipments.
The high-powered Committee of Secretaries is meeting today and may recommend a hike of five per cent on iron ore exports to 20 per cent.
"The government might increase the duty on iron ore exports by five per cent. We do not have buyers due to the declining steel demand globally. What is this move aimed at? Go ahead and ban it if you want, you (govt) will only lose revenue" The Federation of Indian Mineral Industries (FIMI) Secretary General R K Sharma told PTI here today.
There is a fall in demand for the raw materials globally due to falling consumption of steel, he said and added the government will lose around Rs 20,000 to 30,000 crore revenue owing from the mining industry with such discouraging moves, which may lead to closure of the industry.
The Railways earn around Rs 3,500-4,0000 crore from freight charges annually from the miners, he said and added the ports also make around Rs 1,000 crore from the industry.
"The whole economy is going to lose. The mining companies create employment, develop the adjoining area, generate revenue for the centre as well as the state government. The export duty hikes will discourage the miners," he said.
The private mining industry, which include MSPL, Sesa Goa among others, export over 50 per cent of the raw material. Their main domestic consumers are secondary steel and sponge iron manufacturers in the country, he said.
Iron ore prices in the domestic market stands at around $90-100 mark, which has calmed down from $150 few months ago, he added.
Yesterday, Steel Minister Ram Vilas Paswan said that his ministry has suggested a five per cent hike in the iron ore exports to 20 per cent to the Finance Ministry.
