Gross violations by exporters leads government to review iron ore export policy

By Our Economy Bureau | 30 Dec 2004

Chennai: The central government has issued show cause notices to three firms for gross misuse of iron ore export policy.

In view of the magnitude of the misuse, the government is also actively considering restricting export of iron ore above 62 per cent ferrous(Fe) content either through canalisation or other means.

At presently, iron ore with less than 64 per cent Fe content is freely allowed to be exported under the open general licence (OGL), while iron ore with 64 per cent Fe content and above is exported under licence or through MMTC Limited.

However, there were repeated complaints that exporters have been circumventing the policy provisions by declaring iron ore as below 64 per cent Fe content so as to export their consignments under OGL.

Following complaints and representations, four special investigation teams of directorate general of foreign trade (DGFT) including members from the export inspection council (EIC) were deputed for collecting iron ore samples from Mangalore, Haldia, Vishakapatnam and Paradip ports during this November.

A total of 30 samples were collected by the investigating teams and sent for analysis to regional research laboratories. On receipt of the report, it was found that three firms were exporting iron ore above 64 per cent Fe content without licences, based on which the DGFT has taken action by issuing show cause notices under the Foreign Trade (Development & Regulation) Act.