23-05-2016

India: Iron ore exports needs tax relief to compete globally

Ironore

The Indian iron ore export mining industry needs tax relief to compete globally, after its four-year absence from the international market, an industry official has said.

“If and buts are there as we return to the competitive international market,” R K Sharma, secretary-general of the Federation of Indian Mineral Industries (FIMI) said at the fourth Singapore Iron Ore Forum yesterday.

“It will also be challenging to restart some of the mines after they have been closed for four years and flooded by the recent rainy season. Winning new contracts will be challenging,” he said.

“The Indian iron ore exporters have contacts with Chinese buyers though their contracts have been cut off for the last four years,” Sharma said.

But to support the exports, FIMI has renewed call for removal of export duty on high grade Iron Ore which is at 30 per cent.

Delivering an industry address at the Singapore Forum, FIMI President H Noor Ahmed called on the Indian government to remove the export duty on high grade Indian iron ore as it has done so on the lower grade.

“FIMI is putting across (to the) Government of India that exports of iron ore will not lead to any scarcity of ore for the domestic steel plants, present or future. Rather more production will lead to more exploration and discovery of more resources and create more jobs,” he added.

Noor Ahmed said past exploration has yielded 9.215 billion tonnes of iron ore, taking the total reserves to 31.323 billion tonnes as April 2013 from 22.108 billion tonnes in 2000. Only 2.041 billion tonnes were mined between 2000 and 2013.

Sharma said the 30 per cent export duty should be removed and help Indian iron ore exports compete in the competitive market, where currently 62 per cent FE is priced at USD 51 CIF China.

He even called for a minimum cut of 10 per cent in the export duty as has been allowed for National Mineral Development Corporation (NMDC) Ltd, the largest state-owned miner which has continued its exports to Japan and South Korea over the past four years.

The higher grade Indian iron ore has to compete with the same material from Australia but it is better grade than those from Brazil, he pointed out.

Source: PTI

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