The Karnataka Iron and Steel Manufacturers Association (KISMA), headquartered in Torangal of Ballari district, has stressed the need for National Mineral Development Corporation (NMDC), a Union government undertaking, to adopt a uniform pricing policy for iron ore.
NMDC adopting differential pricing policy in the State for iron ore, to profiteer from the shortage of ore, will hit hard steel industries in the State, which are facing a crisis due to recession in the international steel market.
KISMA, in a letter, has urged the Prime Minister’s Office to immediately intervene in the matter to ensure that NMDC adopts a uniform pricing policy, on the lines of Coal India, Oil and Natural Gas Corporation, GAIL, among other public sector undertakings, and direct NMDC not to resort to any profiteering.
“In view of the differential pricing by adopted NMDC, steel industries in the State are at a deeper disadvantage as compared to rest of the country. This will make steel producers in the State uncompetitive and it will lead to idling investment (Rs. 80,000 crore), manpower lay-off (loss of direct employment of around 80,000 to one lakh people) resulting in socio-economic unrest in the region,” Vinod Nowal, president, KISMA, noted, while talking to The Hindu .
Enquiries revealed that the NMDC price for a tonne of iron ore at its Donimalai project in Sandur taluk has been fixed at around 2,700, while the price in its other mining units was around 1,500 per tonne. Even the quality of the ore was reportedly not up to the mark, which in turn has burdened industries as the cost on conversion also goes up.
The State is the third largest producer of iron and steel in the country. There are 70 steel plants in the State, including three integrated steel plants, 53 sponge iron and eight pig iron plants, with a cumulative investment of over Rs. 75,000 crore providing employment to over one lakh people. Ore requirement for the industries in the State was around 33 million tonnes per annum. After the ban on mining by Supreme Court, the production of ore fell to 9.5 million tonnes in 2012-13 from 43 million tonnes in 2009-10.
To ensure that the non-availability of ore would not impact production, employment and economy, the Supreme Court allowed NMDC to produce 12 million tonnes per annum. At present, iron ore production in the State, after a few private mines resumed mining activities, is around 22 million tonnes.
Published - February 29, 2016 12:00 am IST
