Apart from the duty hike, the decline in exports of iron ore was due to a number of reasons, including the imposition of a ban on exports of the raw material from Karnataka since July 2010 following allegations of widespread illegal mining
New Delhi: The country’s miners have said the upward revision in iron ore export duty to 30% will make India’s produce uncompetitive in the global market and total shipments are unlikely to exceed 50 million tonnes (MT) in the current fiscal, reports PTI.
“The government has further hiked export duty on iron ore to 30% on 30th December. This will make Indian iron ore totally uncompetitive in the world market,” Federation of Indian Mineral Industries’ secretary general RK Sharma said.
“Iron ore exports are already down by around 30% during the April-November period of the current fiscal over the same period last fiscal. It will be far more challenging next year,” he added.
The government had raised export duty on both lumps and fines to 20% in the Budget for the current fiscal in order to check the indiscriminate export of the key steel-making raw material and encourage domestic value addition.
India, the world’s third-largest iron ore exporter, had shipped 117.3 MT of iron ore in 2009-10 and 70%-80% of this was in the form of fines, which do not have many takers among domestic steel-makers.
In 2010-11, iron ore exports from the country came down to 97.64 MT and in the first eight months of the current fiscal, exports dipped by a little over 28% to 40 MT vis-a-vis the corresponding period last fiscal.
In fact, following the duty hike in the Budget and a slew of events thereafter, iron ore exports from the country have witnessed negative growth in the current fiscal over the previous fiscal.
Apart from the duty hike, the decline in exports of iron ore was due to a number of reasons, including the imposition of a ban on exports of the raw material from Karnataka since July 2010 following allegations of widespread illegal mining.
Production of iron ore in around 45 mines in Goa has also been shutdown due to environmental reasons. An informal export ban is also in place in Odisha.
Mr Sharma said in the remaining period of the current fiscal, only some quantity of exports would be feasible from Goa, besides stocks lying at other ports.
“However, taking all, it is not going to be 45-50 MT in the current fiscal,” he added.
Concerned over the severe shortage of iron ore after the ban on mining in Karnataka, steel minister Beni Prasad Verma had written to the finance ministry last September for raising export duty on iron ore to 30% to discourage exports.
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Infrastructure Development Finance Company (IDFC) said it had raised Rs532.6 crore through an issue of tax-saving infrastructure bonds. The bonds have been allotted against 2.6 lakh applications, IDFC informed the BSE.
The first tranche opened for subscription on 21 November 2011 and closed on 16 December 2011. The company has plans to raise Rs5,000 crore from the infra bonds issue this fiscal. The five-year bonds carry a coupon rate of 9%.
Amount raised through the first tranche this fiscal is 14% higher than its equivalent in FY11, the company had said in a statement.
The NBFC firm had mopped up Rs1,451 crore from over 7.3 lakh retail investors through the issue of long-term infrastructure bonds in FY11.