The Supreme Court on Friday allowed the export of iron ore already mined in three districts of Karnataka – Bellary, Chitradurga and Tumkar – subject to conditions set by the central government. It has allowed miners to sell such stocks lying in various mines and stock yards in three districts of the state, without resorting to the earlier mandatory e-auction process.
The move will benefit companies such as Vedanta, SLR Metallics, state-run NMDC and other miners.
“Applicants (miners) have been allowed to enter into direct contracts for the extraction of iron ore mined through interstate sales. We also allow the export of iron ore and pellets from iron ore produced in Karnataka, as is being done in the rest of the country, but strictly in accordance with the existing policy of the Government of India, ”said a bench headed by Chief Justice NV Ramna.
The apex court was in a “comprehensive agreement” with the Union Ministry of Steel and Mines to create a “level-playing field” for mines located in three districts with the rest of the country.
“As the Central Empowered Committee (CEC) has indicated, the demand / supply and price of iron ore is determined by the market forces at its best. Since then, e-auctions have been the only way to dispose of mined iron ore. The system has worked satisfactorily so far.
“The course that has been revised, in view of the regeneration after the catastrophic damage to the environment and the various steps taken by the government,” the order dated September 23, 2011 deserved to be relaxed, it added.
It further noted that successive e-auctions conducted by the Monitoring Committee had received a weak response and even iron ore sales at the reserve price were disappointingly low. “Looking at the overall change in perspective, there is a need to remove restrictions on iron ore sales management practices and sales pricing,” the apex court said in its 24-page order.
However, the apex court said that the decision would be taken in July after receiving the opinion of the newly-appointed Oversight Authority on lifting the ceiling on iron ore production in the three districts, from which it was asked to take input. Stakeholders including CEC and Monitoring Committee.
During the hearing in the case, the central government had expressed support for the recovery of exports, saying that the government’s policy was in favor of iron ore exports and Karnataka should not be excluded from its scope. Earlier, the CEC, constituted by the Supreme Court to oversee the sale of iron ore, had also submitted that there was no reason to exclude Karnataka from the facility of iron ore exports.
However, the Karnataka government, led by Basavaraj Bomai, opposed the lifting of the ban on iron ore exports from the state, saying that a proportionate amount of iron ore was required for the growing domestic demand for steel and uncontrolled exports would also create many problems.
Even PSUs like Vedanta, SLR Metallics and NMDC asked SC to allow SC to export or sell iron ore without resorting to e-auction because steel mills and other related industries were not willing to buy under or above e-auction. Conventional market price.
The Federation of Indian Mineral Industries, along with Karnataka’s miners, has demanded the lifting of the ban and closure of e-auction mode of sale. But the Karnataka Iron and Steel Manufacturers Association, of which JSW is also a member, said the country should export iron ore after meeting its requirements.
While mining stakeholders supported the lifting of the ban, the social change community, the NGO, which is appealing to the SC, opposed such exports on the grounds that minerals need to be preserved as national resources and only finished steel. Should be exported. It further said that exports should not be allowed as there is no surplus of iron ore.
The Supreme Court in 2011 banned the export of iron ore from Karnataka to assess the environmental damage to the state and set a maximum allowable annual production limit of 35 MMT for Class A and B mining.