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Goa welcomes Centre’s roll-back of export duty on low grade iron ore
The Goa government has said that the Centre’s decision to withdraw the export duty will help propel the upcoming export of iron ore from the state
The Goa government has welcomed the move of the Union government to withdraw the export duty on low grade iron ore saying the decision will help propel the upcoming export of iron ore from Goa.
“I thank the Hon’ble Union Home Minister Shri @AmitShah Ji for his support in withdrawal of export duty on iron ore with less than 58% Fe. This will fetch higher revenues to Goa Govt in auctioning of mining leases. This will also propel export of low-grade iron ore from Goa giving relief to various segments in iron ore business and allied activities,” Goa chief minister Pramod Sawant said via Twitter on Saturday.
As per a notification of the Union finance ministry issued late on Friday, exports of iron ore lumps and fines with ‘less than 58 per cent Fe’ will attract NIL export duty. In the case of iron ore lumps and fines with more than ‘58 per cent Fe’, the rate of duty will be 30 per cent. Exports of iron ore pellets will attract NIL export duty.
The government has withdrawn or cut export duty on steel products and iron ore effective Saturday. Duty was imposed in May this year.
The Goa government had earlier in May this year written to the Union government seeking a withdrawal of the duty claiming that iron ore mined in Goa, that is mainly exported being low grade ore, would be priced out of international markets if slapped with the export duty.
“Goa’s ore largely being low grade (i.e. below 58% Iron content), and not processed for steel making in the country, State of Goa has requested the Ministry of Finance to consider ‘NIL’ export duty instead of 50% on the low-grade iron ore exports, as was done since 2016. This is necessary for sustainable mining in the State,” the Chief Minister’s Office (CMO) had said after a meeting between Sawant and Union finance minister Nirmala Sitharaman.
On May 21, the Union government hiked the export duty on all grades of iron ore to 50% with a view to increase domestic availability. The export duty on high grade iron ore was hiked from 30% to 50% while the duty on low grade iron ore which was completely waived, back in 2016 at Goa’s request was also hiked and brought on par with high grade iron ore at 50%.
Goa’s iron ore mining industry is completely dependent on exports since barring a lone steel plant, there are no domestic buyers for the ore since the cost of transportation from the mines to the plants, the closest of which are located in North Karnataka, makes it not viable for domestic buyers. Instead, since the mines are located close to the port, export is the preferred option.
Goa’s iron ore mining industry is currently at a standstill, barring the movement and export of ore that was already mined prior to the shuttering of mining back in 2018 and the movement of ore that was confiscated and auctioned by the state government. Several companies have also been exporting ore claiming it has been extracted prior to 2007, when Goa’s mining leases were declared as expired.
