Union Minister for Steel Virbhadra Singh said on Saturday that the Government was “considering” a ban on iron ore exports. “The other option is to consider taxes on exports as a deterrent,” he added.

Mr. Singh was presenting JSW Steel with the Steel Minister's Trophy for the Best Integrated Steel Plant in the country in 2007-08.

The Union Minister said: “Ultimately, a decision would be taken by the Cabinet. Existing steel mills should get priority in the allotment of ore because they have to be assured of long term availability.”

Mr. Virbhadra Singh commended the State Government's stand on stopping iron ore exports, but said it could only have “local effect.” He said: “We need a national policy on the issue.” The Group of Ministers, headed by Union Finance Minister Pranab Mukherjee, was studying the feasibility of giving a stake of 26 per cent to those who lose their land to mining companies. “This will have to be ratified by the Cabinet. There is no dearth of ore in the country, but we must ensure that domestic users get preference,” he said.

Sajjan Jindal, Vice-Chairman and Managing Director of JSW Steel Ltd., which runs one of the biggest integrated steel plants at a single location in the country, called for “a calibrated ban on exports.” Export of iron ore could be phased out over a five-year period by reducing exports by 20 per cent each year.

“What Mr. Yeddyurappa has done is correct,” he said. “Other states may follow, but the Centre has not done anything on the issue,” he said.

Mr. Jindal said his company had been assured by the State Government that it would “get priority” before new players such as ArcelorMittal are awarded captive mines. He criticised the Union Government for favouring “foreign players” vis-à-vis Indian steel companies.

Mr. Jindal said: “Foreigners get preference in our country. Posco (the Korean steel company), for instance, was given more importance than Tata Steel when both wanted to establish steel plants in Orissa. I reserve the right to fight it in court if we are discriminated against.”

Ore becoming unviable

Mr. Jindal said the exports had contributed to the steep increase in domestic iron ore prices, driving them “to the point of making it unviable for Indian steel manufacturers.”

“India is exporting ore and importing steel from China, which is against the stated policy of the Government,” he said. The influence of the “mining lobby” in the State “cuts across party lines, even though it has been portrayed in the media as a fight between the Reddy brothers and the Congress,” Mr. Jindal said.

By deliberately “under-valuing exports,” exporters either take funds overseas or plough them back into assets such as real estate, he said. There was no place for illegal mining in legitimate economic activity. “The very term ‘mine-owner' is a misnomer,” he said. “The mines are actually owned by the Government, but it earns only a fraction of what the mine operator earns,” he said. “The plight of the workers in the mines here is terrible, they are paid a pittance and they do not even wear shoes when they are working,” he said.

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