National Mineral Policy 2006 - Department of Mines

Annexure 12 gives the production and export figures for 2002–03, 2003–04, and 2004–05. Itwould be seen that for 2004–05 exports amounted for as much as 50.94 per cent of theproduction and a significant part of the exports is from the south-western region. A restrictionon exports would straightaway hit half the iron ore mining industry, and many mines,particularly in the south-western region, may have to close down. Paragraphs 7.40 and 7.41above deal with the regional aspect of the issue in greater detail. A special mention has alsobeen made there of Jindal Steel Works, which advocates a ban on exports from the region sothat assured iron ore becomes available to it in the future. However, as mentioned earlier, ashortage scenario based purely on proven reserves of haematite is not warranted at this stageof development of the country’s mine and steel development. For the nation as a whole thenon-captive segment in the mining industry accounts for 75.44 per cent of the totalproduction, and if we leave aside PSUs such as Orissa Mining Corporation (OMC) andNMDC and the 11 large stand alone miners then the rest of iron ore mining is entirely in theSME sector. According to the National Steel Policy document too, the indigenous demand foriron ore will take more than 11 years to reach the level of 145 million tonnes. In addition,export of iron ore provides employment on a large scale to the people of Goa, Karnataka, aswell as in the SME and larger mines in the eastern and central parts of the country and is asignificant catalyst of socio-economic development in the backward and tribal belts. As willbe seen from Annexure 13, the increase in production over the last three years has beenmainly from the non-captive SME mines and is export-driven. Since steel production hasincreased marginally, there is only a small increase in domestic consumption. As against this,the states of Goa, Karnataka, and Orissa, which have a large number of non-captive mines,have seen a surge in the production of iron ore. Apart from mining proper, associated sectorssuch as transportation, ore handling, minor and major ports, and service providers such asshipping lines and vessel yards all gain from the export activity. Employment-wise, if exportsare banned 70,000 persons will become jobless, and due to tertiary sector linkages, at leasthalf a million more would lose their livelihood. For this reason alone, any severe restrictionor ban on exports of iron ore is not conceivable.THE CASE FOR EXPORT OF FINES7.57 Out of the total iron ore exports from India of 78 million tonnes in 2004–05 as muchas 65 million tonnes or 83 per cent was exported in the form of fines. Domestic demand forfines is only to the extent of the sintering and pelletisation capacity available. If surplus finesare not exported, they will go waste. If exports were further restricted in any manner, its mainimpact would be on fines. In that event, SME miners, especially in south-western India, willhave no market left for their fines.165