May 2007 - SIMA

CHAIRMAN’S COMMUNIQUE
With an aim of preserving precious iron ore for the use by Indigenous steel mills, Finance Bill
2007 has introduced levy of export duty of Rs. 300/- per ton on the exports of iron ore.
This must have cheered the members of SIMA as way back in 2003, through a detailed
presentation on iron ore scenario in SIMA AGM, in the presence of the then Hon’ble Minister
of Steel Mr. B K Tripathi, I had stressed that unless Govt takes measures to regulate the
exports of iron ore, India might need to start import of iron ore.
Since despite this measure, export of iron ore has shown increasing trend, we hope that
Government of India would take a decision soon either to curb or ban exports of iron ore: as ore export s an
export without any value addition and thus eating away possible inflow of forex into India and job opportunities
in the country. Iron ore needs to be used wisely as an anchor for growth and development of the domestic
steel industry. In fact iron ore is the prime reason why we have multinational corporation wanting to get into
India. We have already proposed to the government to phase out iron ore export in progressive manner by
putting cap on iron ore exports at current level. The reduction in iron ore export by 15% every year and finally
export to be made zero by year 2011-12 by which time the demand is expected to match the level of production
of iron ore in the country. Imposition of Rs.300/- per ton is only a symbolic representation and possibly the
first step towards conservation and security of our finite reserves of iron ore.
Over the years coal based sponge iron producers have been facing acute shortage in supply of quality and
quantity of non coking coal for the manufacture of sponge iron mainly due to such policy of the Government
which makes the middlemen (traders) more powerful distributor and thus affecting the end consumer.
Meanwhile our Vice Chairman Mr. N K Patnaik alongwith OSIMA Chairman Mr. G S Agrawal & representatives
of coal based units, presented comments and suggestions, to be implemented in the proposed new Coal
Distribution policy, to the newly constituted Committee chaired by Secretary Coal, which has been set up
under the directives of Hon’ble Supreme Court, to evolve a viable and fair Coal Distribution policy. This is a
good step emanating from Supreme Court directive and we hope our suggestions and comments will find
place in the new policy thus bringing relief to the coal based units.
While the Govt of India has recognized our association’s value and takes inputs at the time of formulating a
policy, our international exposures, viz admission of foreign members, foreign visits improve vision and sharing
of technological expertise have been of immense use to the members. It is heartening to note that our
association took a strong delegation recently to Muscat to attend Arab Steel Summit 2007 organised by Arab
Iron & Steel Union(AISU).
I hope the new journal reaches your desk by the time we meet again on 10 th May 2007 for Annual General
Meeting, in Delhi.
Wishing you all the best.
P.R. DHARIWAL
MAY-2007/1