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Goa sponge iron producers ask govt to ensure raw material supply

Press Trust of India  |  New Delhi 

and alloy makers have asked the government to ensure supply of ore to sponge and pig units in following a ban on mining operations in the state from March 16 threatening to disrupt supply of raw material. ore is the key raw material used to produce sponge which is used in producing semi-finished items, ingots and billets. In a letter to Secretary Aruna Sharma, the Alloy and Manufacturers Association of said the closure of ore mines in from March 16 will adversely impact the industry. The ministry should intervene and ensure that ore supply to pig and sponge plants, which in turn cater to the local industry, does not gets hit, the letter said. On February 7, the quashed the second renewal of 88 ore mining leases in in 2015 and gave time till March 15 to the mining lease holders, who have been granted a second renewal in violation of its previous directions to manage their affairs. "We are extremely concerned about the security of raw material for the industry as the plants rely upon ore produced in for producing sponge and pig and the secondary producers utilise the sponge and pig to produce One pig based plant already closed down many years ago," the association said. There is one large pig plant in Goa, four sponge units and 39 secondary producers.

The sponge and industry provides employment to 25,000 people directly and indirectly, it said. The sector generates around Rs 130 crore revenue in the form of direct taxes and is the sole generator of in state producing over 60 MW power, a major part of which is supplied to the department at less than Rs 2.5 per unit, it added. The closure will affect the jobs of those dependent on the sector besides it will hurt various others related to the sector such as transporters, O&M (operations and maintenance) service providers, port services also, the body said. The ministry has taken many steps to help revive the troubled large plants in various parts of the country including Odisha wherein the ministry has played an active role in ensuring continuity of coal and ore supplies, the association said. "We request you to help the small and nascent industry. We appeal to you to take steps to resolve these concerns by ensuring continuity of ore supply to pig plants which in turn catering to the local industry," it said. With the high international coking coal prices, the local industry operates on thin margins and is not in a position to absorb the cost of imported ore or logistics from other states, the association added.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Sun, March 11 2018. 11:35 IST