The government today rejected demand for ban on iron ore export, making it clear that states must take steps to prevent illegal mining.
"Merely because state governments are not able to prevent and stop illegal mining, we should not ban export of iron ore," Mines Minister B K Handique said while replying to a debate on illegal mining in the Rajya Sabha.
The problem of illegal mining, which is growing in alarming proportion in Karnataka, Andhra Pradesh, Orissa and Jharkhand, is a problem of governance, he said.
Besides the Karnataka Government, Left parties and the steel industry have been demanding a ban on the export of iron ore. Even the Union Steel Ministry has been making out a case for the ban.
"Rather than banning export of iron ore, we need to see there is no illegal production of iron ore," the minister said, adding that the need of the hour is to tighten the regulatory system with adequate staff.
The minister also clarified that Karnataka, which is the second largest producer of iron ore in the country, has not banned export of iron ore.
"Karnataka has prohibited transportation of iron ore to ports and not export as such," he said.
Iron ore is a vital steel making raw material. India, the world's third largest iron ore exporter, produced 218 million tonnes of iron ore in 2009-10 fiscal and exported 128 million tonnes.
Participating in the debate, Leader of the Opposition Arun Jaitley said illegal mining is done by those who have legitimate permission for lawful mining. "On account of illegal mining there is large scale tax evasion," he said.
He suggested that mines should be allotted to those who are actual users. It is necessary to link the allotment of mines and minerals to the manufacturers rather than mere traders, he added.
Jaitley further said the government must allow volumes to be mined that is required in the country and leave adequate resource for the future generations.
Pointing royalty and revenue to the state and central governments are dismal, he said, "There is a need to review and increase the volume of these taxes."
