NEW DELHI (Commodity Online): India’s GDP growth at 9% will create demand for 113 million tons (mt) of steel and 206 mt of iron ore by 2016-17 as the country embarks on several infrastructure projects and the current production of iron ore in India is 208 mt of which 98 mt is exported, according to industry body The Associated Chambers of Commerce and Industry of India (ASSOCHAM).
Presently, India's steel demand is around 70 million tons
The conservation of iron ore is in the national interest as reserves may run out rapidly due to projected growth of the economy ,
According to industry body, the government’s decision to hike duty on iron ore exports from five to 30% is a step in the right direction which will put emphasis on value addition within the country to meet growing demand of steel.
Meanwhile, China had imposed a duty of 40% on exports of coal and coke for value addition within the country. This led to creation of the world’s largest steel manufacturing capacity and accelerated China’s GDP growth.
“The industry body have always advocated a complete ban on iron ore exports. However, discouraging them through fiscal measures is an appropriate solution to utilise large mining, infrastructure and port capacities created for iron ore,” said D.S. Rawat, secretary general, ASSOCHAM.
India exported iron ore worth 4.7 billion dollars in 2010-11 and imported finished steel worth 11 billion dollars, thus contributing negatively to widening trade deficit and draining foreign exchange reserves.
