The commerce and industry ministry has said on Monday that it is not in favour of restricting iron ore exports even as the ministry of steel and Karnataka government want curbs on the mineral shipments.
"...if iron ore exports are restricted, it would affect economic activities in remote areas where handling of iron ore is the main employment generating activity," Minister of State for Commerce and Industry Jyotiraditya Scindia informed the Lok Sabha.
Steel ministry and Karnataka Chief Minister B.S. Yeddyurappa are in favour of discouraging exports of iron ore to appropriate export duty in view of exploitation of mines and illegal mining.
Scindia said iron ore production in the country has always been higher than the capacity of domestic steel industry to consume it.
India is mainly exporting iron ore fines, which are not used by domestic steel industry due to limited sintering and pelletisation capacity.
"There is a need to export excess ore (mainly fines) as it cannot be stored and would cause environmental degradation and hazards in mining areas, if not evacuated and exported," he said.
During 2008-09 iron ore fines constituted about 87 per cent of the total iron ore exports.