The Ministry of Commerce and Industry is contemplating formulating a national raw material policy to regulate and conserve mineral resources and keep a tab on their pricing. Requests for such measures have been emanating from downstream industries following a steep rise in the cost of metals and minerals like iron ore and pig iron this year.
A policy note prepared by Engineering Export Promotion Council recommends a host of steps that the proposed policy should take including phasing out of iron ore exports, ad valorem duty of 25 per cent on iron ore mining and an export duty on steel.
It also recommended a moratorium on steel prices of at least three months and compulsory listing of prices by all steel companies on their websites.
Prices of some of the steel items have gone up by almost 20 per cent between May and August this year following an over 30 per cent increase between December and May. Further the note pointed that in some cases the export price of steel has been found to be lower than the prevailing domestic prices.
With 25 billion tonne iron ore, India has world's sixth largest reserve of the ore but the investments flowing into the sector would mean the reserves will not last more than 19 years, the note said. Ore exports grew by 115 per cent between 2001-05 and reached a level of 100 mt in 2006-07, ahead of schedule by 14 years.
The ministry has now asked the ministry of coal to respond to the suggestions.