(Adds comments from minister, industry body)
By Krishna N Das
NEW DELHI, July 31 India's mines ministry is
seeking a cut in the iron ore export duty after a sharp fall in
overseas shipments, days after the prime minister spoke about
increasing exports to tame the country's current account
India was once the third-largest exporter of the steelmaking
raw material, but shipments plunged more than 80 percent in
three years to hit 18 million tonnes last fiscal year. The lower
exports have helped cushion global iron ore prices.
"I have written to the finance and commerce ministries to
consider a cut in the duty, at least on low-grade fines," mines
minister Dinsha Patel said on Wednesday on the sidelines of a
conference, declining to give the duty he had suggested.
Lower production due to a clamp down in illegal mining, an
export tax of 30 percent and higher railway freight rates are
the main reasons for the slump, according to H.C. Daga,
president of the Federation of Indian Mineral Industries (FIMI).
"With the withdrawal of about 100 million tonnes (of Indian
iron ore) from the world market, iron ore prices that were in a
declining trend suddenly firmed up, benefiting (foreign) private
companies at the cost of India and its exporters," Daga said.
Prime Minister Manmohan Singh said earlier this month that
the government was trying to remove "constraints in the export
of iron and other ores".
Government officials declined to say what steps the prime
minister was referring to, but Daga said he expected a cut in
the export duty soon as a result of hectic lobbying by FIMI with
Patel said his ministry would make all possible efforts to
resolve problems related to the iron ore industry in Goa,
India's top iron ore exporting state, where mining has been
banned since last year following allegations of irregularities.
"I am convinced that the problem of Goa will be resolved
soon," Patel said.
Goa expects court approval to resume by year-end the
production and export of iron ore from mines with a capacity of
about 40 million tonnes as it has taken steps to rectify
problems that led to the ban, a state bureaucrat told Reuters in
The state exports all of its iron ore to China.
(Additional reporting by Siddesh Mayenkar in Mumbai; Editing by