India’s ministry of mines has come out strongly in favour of the export of iron ore in a meeting with the Parliamentary Consultative Committee attached to the ministry.
The ministry told the committee that there is no need to curb exports of iron ore without a matching increase in domestic consumption of ore produced in the country. In effect, this might be inimical to the country’s standalone mining industry, thus severely affecting employment and economic activity in several backward regions, where these mines are located.
The ministry’s view is significant since it comes in the wake of imposition of a 15% ad valorem export duty on iron ore by the government to rein in inflation earlier this month. India has large pockets of high-grade iron ore deposits. While current reserves are estimated at 25.25 billion tonne (bt) between 1980 and 2005, reserves rose from 17.56 bt to the present level.
This leads to an average increase of a little over 256 mt, while average production has been around 163 mt. Less than 19% of the iron ore bearing area has subjected to detailed exploration. There has been a steady increase in the production of iron ore since 2003-04.
From 122.8 mt in 2002-04, the estimated production in 2006-07 had gone up to 180.9 mt. During the same period, the consumption of iron ore too, has gone up from 44.97 mt to an estimated 72 mt. Between 2003-04 and 2006-07, exports grew from 62.57 mt to 93.79 mt.
Source: Economic Times
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