Allow market forces to decide on iron ore export: industry expert

Mumbai: Even as the union steel ministry has ruled out banning iron ore exports from Goa and the state is awaiting Shah panel report on illegal mining, an industry expert today said the government should allow the market forces to decide the issue. “Instead of banning exports, the government should regulate mining by allowing the bonafide concessionaires to continue to operate,” said Sachin Seghal, director of OreTeam, a research firm on iron and steel. It is believed that Justice MB Shah committee’s report, expected early next month, may recommend a ban on iron ore exports from Goa. The state contributed over 40 million tons of the 120 million tons of ore exported from the country last year. “What we need is not a ban… instead, the government should stringently implement existing regulations on one hand and act like an enabler of this crucial activity (of legal mining) on the other, as ore exports contribute considerably to forex revenue and are critical to Goan economy,” he said. [caption id=“attachment_135347” align=“alignleft” width=“380” caption=“The coastal state has 90-odd working mines and over 30 non-functional ones. Raman Kirpal/Firstpost”] [/caption] Goa, the largest contributor of the iron ore exports, ships out its entire output (54 million tons last year) as domestic steel companies do not buy it due to poor quality. India was the third largest exporter of iron ore last year, mostly to China, Japan and Australia. Saying that country’s proven 25 billion tons of iron ore reserves can last for decades, he said the exports make sense as the country does not have the technology to process the low-quality Goan ore. Ore mining in Goa is over half-a-century old, but of late it has attracted a lot of illegal operators as prices shot up due to excessive demand from China. Allegations of large-scale illegal mining forced the government to appoint a commission under the chairmanship of Justice Shah. The coastal state has 90-odd working mines and over 30 non-functional ones. The Shah panel is vetting all the 120 mines, many of which are said to be illegal. Last week, the chief economist at the steel ministry’s economic research unit, AS Firoz said at an international meet in Goa that the ministry had no plans to ban ore exports. “It is not the government policies but the market forces that will result in dip in our iron ore exports. Iron ore exports may drop to 30-40 million tons by 2016, as the global slowdown persists and China also slows down,” he said. PTI