Sesa says iron ore export tax needs to be scrapped

India imposes a 30% tax on iron ore exports, making it unviable for many domestic iron ore miners to sell overseas, the company says

Sesa Sterlite Ltd said there was an "urgent need" to remove a tax on the India's iron ore exports in the face of falling global prices.

India imposes a 30 percent tax on iron ore exports, making it unviable for many domestic iron ore miners to sell overseas where prices have tumbled by more than 40 percent this year.

Sesa hopes to restart by early 2015 iron ore mining in the state of Goa - previously the top exporting state where no mining has taken place since September 2012 due to action against illegal mining.

"There is an urgent need to eliminate the export duty, which represents an economic barrier to mining in the current low price environment for low grade iron ore fines," Tom Albanese, chief executive of Vedanta Resources that controls Sesa, told Reuters in an email late on Tuesday.

 

Sesa is India's top private iron ore mining company with most of its operations in Goa. The Supreme Court has lifted the mining ban in the state this year.

"Based on recent public comments by the government of Goa, it's now probably realistic to assume mining to start by January to February at the earliest," Albanese said.

Albanese was formerly chief executive of mining giant Rio Tinto who quit Rio last year after the company revealed a $14 billion writedown.

The early 2015 restart for Sesa's operations in Goa indicates months of delays versus initial expectations for a restart in September.