and Industry, Coimbatore
Press Release
April 30, 2010: Export Duty on Iron Ore
The Union Minister for Commerce and Industry Shri Anand Sharma on 27/04/2010 has spoken against any increase on the export duty on Iron Ore fines and has advocated only a marginal increase of duty on Iron Ore in Lumps. (The Hindu Business Line, 28/04/2010, Page 1). On the same day, he released a strategy paper on engineering exports for the period 2010-2014, brought out by EEPC (formerly called Engineering Export Promotion Council of India), targeting an increase of exports to US $ 110 Billion from the current $35 Billion.
The reason given by the Minister for his opposition to the increase in duty on iron ore, is that mining is a labour intensive activity in the backward regions of our Country. Presumably his sympathy lies with miners rather than the engineering industry and the exporters of engineering products, which provide millions jobs, particularly in the MSME sector.
The Engineering Industry is hit with an increase in prices of its raw materials, mainly Iron and Steel. It is finding itself to be uncompetitive in the export sector. Whatever EEPC and the Commerce Ministry plan for engineering exports would not materialize if Iron and Steel are not available to the industry at competitive prices.
Iron and Steel are also important to all sectors of domestic industry, including Construction and Agriculture. We hope that the Minister would take cognizance of the impact of the increase in the Iron and Steel prices on them.
The newspaper also reports that there was lobbying against the proposal to the increased duty. Needless to say, this must be from the exporters of iron ore and their customers.
At this juncture, it is worthwhile to recall the steps taken by the Textile Ministry of Government of India against the increase in the yarn price. The Ministry has put severe restrictions on cotton and yarn exports to promote more value added exports and help the exporters, regardless of the impact of such a step on millions cotton growers and lakhs of employees of cotton spinning mills.
We urge the Union Ministry of Commerce & Industry to lay emphasis on value added products, rather than raw material and increase the duty on export of all iron ore, most of which goes to China our competitor.
Mahendra Ramdas
President