India's largest iron ore mining company NMDC today said the hike in export duty on iron ore to 20% may not impact the domestic price situation.
"I don't think so (of any domestic price impact). Because, the international price is already very high. And in normal economic trend, whenever there is duty hike the domestic prices will go down. But iron ore is such a commodity... Good quality of iron ore is scarce in our country so the price may go up also. Lets see," NMDC Chairman Rana Som told reporters on the sidelines of a seminar-"Millennium Development Goals, performance, prospectus and challenges for South India" at Institute of Public Enterprises here.
Union Finance Minister Pranab Mukherjee in the Budget for 2011-12 had fixed a uniform export duty of 20% on all types of iron ore, which is a vital steel-making raw material.
Replying to a question on possible export price revision in the wake of duty hike, he said they will have to consider the impact on domestic price before taking a decision.
"That is some thing we will have to discuss. We have no idea at this moment. We are watching the situation. Whenever such types of duties are there will be two type of impacts. One, it impacts the materialisation of import. The second and the most important impact is how the duty will be impacting the domestic price situation. So we will have to take into account both the situations," Rana Som said.
He said the duty hike may generate Rs 10,000 crore additional revenue to the government.
Meanwhile, NMDC signed a contract agreement with a consortium comprising SVAI, Austria, SVAI India, and NCC for turnkey execution of a 460 mxm sinterplant complex at 3 million tonne integrated steel plant at Nagarnar.
The schedule of the project is 33 months from the effective date of contract.
