Government is likely to control the export of
high quality iron ore to build
domestic reserves so a string of major
steel projects can achieve their
targets. India currently produces 38
million tons (mt) and wants to grow
this capacity to 110 mt by 2020
powered by world’s largest steel
maker Mittal Steel, 5th
largest Posco, and India firms such as
Tata Steel.
India has the highest deposits iron ore of
24 billion tons (bt) most of which is
high grade with up to 65% iron
content. Last year India exported 76
mt (of which 68 mt went to China) and
this year the export is expected to be
80 mt.
China has about 46 bt but most of the
deposits there are of poor quality.
Therefore, China depends on the import
of high-grade iron ore from India,
Australia, and Brazil to power its
economy.
Indian steel manufacturers have been lobbying the Government
to stop the export of high-grade iron ore so as not to
lose the advantage to China. Whereas, the exporters
claim that the export of iron ore will not adversely
affect the Indian economy because of large deposits
and the lack of need for this amount of iron ore till
after 5 years when the new steel mills will be
required. |