As the mining, iron ore mining leases are being met, challenges will arise against the steel industry

(PTI) New delhi date. 23 December 2019, Saturday

With the completion of several mining leases, there is a possibility of disruption in the steel industry after March 5, said state-owned Steel Authority of India Ltd. (SAIL).

Some leases for coal and iron ore mining are coming to an end on March 7. As per the amended Mines and Minerals (Development and Regulation) Act, this license will not be renewed and the mines will be allocated through new auctions.

Due to the change in the Act, every allocation is taking place around the auction route today, with many issues being raised and it may be time for the steel industry to intervene from April next year. Because the coal will have to be re-auctioned, Sail sources said.

He was speaking at an event organized by Fiki. High raw material prices are also becoming a concern for the industry. In India, steel production costs are the highest today. The main reason for this is taxes.

Twenty percent of the royalties pay for raw materials. Freight rates are higher here than in other countries. Apart from this, the cost of electricity also increases due to the cost of production, he said.

Coking coal and iron ore are two major raw materials for steel production. India is self-sufficient in iron ore but in terms of coal, steel industry mostly depends on imports.

Under the National Steel Policy, the government has set a target to increase steel production capacity in the country to 8 MT.