Updated March 24th, 2024 at 12:58 IST

Mining industry urges government to avoid export duty on low-grade iron ore

More than 90 per cent of India's iron ore exports are directed to China, making it a critical market for the sector.

Reported by: Business Desk
FIMI warned of potential production setbacks if export bans or duties were implemented | Image:Unsplash
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The Federation of Indian Mineral Industries (FIMI) has issued a plea to the government, urging against the imposition of export duties on low-grade iron ore. According to FIMI, such a measure would not only result in substantial revenue losses for the state but also adversely impact employment and foreign exchange earnings.

Highlighting the significant contribution of the mining sector to India's GDP, particularly iron ore among non-coal minerals, FIMI stressed on its role in job creation, employing approximately 5 lakh individuals, both directly and indirectly.

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FIMI's representation to the government highlighted the adverse effects of the export duty imposed on low-grade iron ore fines and pellets in May 2022, which was later rescinded in November of the same year. The body underscored that any proposal to ban or restrict exports of iron ore and pellets would be detrimental to the industry.

More than 90 per cent of India's iron ore exports are directed to China, making it a critical market for the sector. FIMI stressed on the importance of maintaining the current status quo of zero export duty on these products to sustain industry growth.

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Additionally, FIMI warned of potential production setbacks if export bans or duties were implemented, projecting a drop in production from 330 million tonnes to 225 million tonnes in FY'25.

The representation also highlighted the challenge of managing iron ore fines, which constitute a significant portion of mined ore. These fines, particularly those below 58 per cent Fe, pose logistical and environmental challenges, limiting their utility in the steel industry and hindering scientific mining practices.

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(With PTI inputs)
 

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Published March 24th, 2024 at 12:58 IST