The State Government on Wednesday imposed restrictions on the sale and export of iron ore. “The entire ore produced in the mining operation shall be used exclusively for own consumption in iron and steel making and cannot be either sold in India or exported to other countries,” said an order of the Ministry of Mines circulated among the district collectors and concerned officers of the Steel and Mines Department.
On September 19, the Centre imposed the special condition under Rule 27(3) of the Mining Concession Rules 1960 restricting the sale and export of iron ore and the order was communicated to the State recently.
“The State Government may, either with the previous approval of the Central Government or at the instance of the Central Government, impose such further conditions as may be necessary in the interests of mineral development, including development of atomic minerals,” said Rule 27(3) of the MCR, 1960.
The Centre approving the ban on export of iron ore came exactly a year after Chief Minister Naveen Patnaik’s demand for such a restriction. Naveen, who has been demanding imposition of rent tax at the rate of 50 per cent on iron ore in view of the super normal profit being made by private mine owners, had written to Prime Minister Manmohan Singh on November 10 last year requesting a ban on export of iron ore.
The present fiscal and regulatory framework for iron ore is resulting in unjust and vast enrichment of a few mine owners without commensurate benefits to the community at large. He urged the Prime Minister that a decision on the imposition of the rent tax which was in the public interest should not be delayed any further.
The ban on export is necessary as the demand for steel and its production in the country are both expected to grow at an annual rate of 10 per cent, Naveen said, adding, there is thus a need for having a long-term strategy for conservation of the finite iron ore resources to meet the future requirements of our country.
However, Union Commerce and Industries Minister Anand Sharma then ruled out total ban on export of iron ore stating that it would have serious implications on the mining industry and cause a steep rise in unemployment.