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Scrutiny
  
The weak iron!
archaic policies all it takes...
04/10/2007

With booming infrastructure & mushrooming industries, the iron and steel market in India seems to experience a new trend altogether. According to National Mineral Development, in-spite of being third largest producer of iron ore, India still needs 240 million metric tonnes more (71% more) by 2020 to bridge its demand & supply gap. But this dream of ten fold growth seems vague as Indian iron ore policy suffers from 50 year old mining law & stringent license raj policies. The current opaque & unreformed policies confine the industry production to merely 23 billion metric tonnes. Moreover, the mining activities are not centralised which further add on to the cost. The pricing & loyalty rates are still not revised and thus make the industry under-capitalised which affects productivity level. Mines being located in the three poorest states, coupled with present royalty rates, as low as Rs.11/tonne, the iron ore mining suffers great difficulties in terms of competing with international market. It’s very obvious that our extant policies need a total overhaul and sought after road map for international market & domestic ore consumption and eradication of the license raj maze, on priority.

By:- B&E
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