KARNATAKA

Export duty on iron ore hits Goa's industry

Special Correspondent

Five China-bound vessels stand cancelled

Industry representatives to meet Chidambaram `No fresh nominations till the issue is sorted out'

PANAJI: Five China-bound export vessels containing iron ore have been cancelled, at least for the time being, following the whopping export duty slapped by the Union Budget on iron ore exports, according to representatives in Goa's private sector iron ore mining industry.

Reeling under the impact of the duty at Rs. 300 a tonne, which came into effect from Thursday, the industry has demanded that the duty be rolled back to save the industry. Goa's exporters plan to meet Union Finance Minister P. Chidambaram next week to sort out the issue.

"We are already facing the adverse impact of the Union Budget. Five China-bound vessels of three lakh tonne of ore were cancelled on Thursday," S. Sridhar, executive director of the Goa Mineral Ore Exporters' Association (GMOEA), a body representing iron ore exporters in the State, told The Hindu on Thursday.

"While 23 vessels, which are in Mormugao and Panaji port, will set sail with ore, the industry has decided that nobody will accept fresh nominations till the issue is sorted out," Mr. Sridhar declared.

The industry sources said the steep duty came at a time when low-grade Goan iron ore was competing with ore from Australia and Brazil.

"Low-grade ore is not utilised by the domestic steel industry unless it is blended with high-grade ore," Mr. Sridhar said. "Importing countries also blend Goan ore with high-grade ore from Australia and Brazil. It is only through these means and proximity to the coast that Goa is still a viable source for iron ore," he added.

Mr. Sridhar said that from the budget speech of the Finance Minister it appeared that the introduction of customs levy on exports of iron ore was based on the Hoda Committee report.

Leading sector

Mining continues to be a leading sector in the State in terms of foreign exchange earnings and employment generation.

Around 35,000 people are directly and indirectly employed in the industry, which earns close to Rs. 3,500 crore in foreign exchange annually by operating around 80 mining leases in open cast mines.

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