The domestic miners have said the upward revision in the export duty on iron ore to 30 per cent would make India's produce uncompetitive in the global market and total shipments were unlikely to exceed 50 million tonnes in the current fiscal.

“The government has further hiked the export duty on iron ore to 30 per cent on December 30. This will make Indian iron ore totally uncompetitive in the world market,” Federation of Indian Mineral Industries' Secretary-General R. K. Sharma said.

“Iron ore exports are already down by around 30 per cent 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 the export duty on both lumps and fines to 20 per cent in the budget for the current fiscal 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 million tonnes of iron ore in 2009-10 and 70-80 per cent 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 million tonnes and in the first eight months of the current fiscal, exports dipped by a little over 28 per cent to 40 million tonnes 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 vis-a-vis 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 million tonnes 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 the export duty on iron ore to 30 per cent to discourage exports.