Jindal, govt accuse each other of short sight

Critical words were exchanged on Tuesday between Indian steel tycoon Sajjan Jindal of the billionaire Jindal clan and the government over the steel industry’s problems from the unprecedented raw material crunch.

Jindal accused the government for following a “skewed” policy of exporting valuable minerals like iron ore in bulk, even as the domestic industry struggles to survive. “At a time when other nations are putting restrictions on export of their resources, does it make sense for India to send our valuable reserves outside in bulk? As a result of this skewed policy, we (industry) end up paying higher price for our own resources,” Jindal said during his speech at an event on mineral technologies.

He was also referring to the ongoing policy and legislative changes from the governments of Indonesia and Australia, two of the largest suppliers of iron ore globally, to restrict outbound shipments of minerals by either linking export prices to international benchmarks or levying additional duties on value-added ores.

Union mining secretary S Vijay Kumar, present at the event, fired back by accusing the domestic industry of not ramping up capacities to utilise the entire domestic produce. “Large-scale exports of iron ore have taken place owing to the lack of the industry’s capacity to absorb production. Exports have not damaged the industry. I do not see this as a failure of the government’s policy. It is the failure of the industry to do sintering (value addition),” he said.

Jindal also said the high iron ore prices in Karnataka were a result of the government’s “skewed policy” policy of unchecked exports of minerals. Kumar, however, said a part of the reason for the Karnataka mining mess was the failure of companies to develop a proper understanding of the concept of sustainability. “Corporates think that sustainability merely means ensuring long-term availability of the mineral. They fail to realise that it also includes sustainable environment for locals,” he said.

India produces 220 million tonnes of iron ore annually. Of this, 110 mt is consumed within the country, largely by the steel industry. The rest is exported, largely to China. The Sajjan Jindal-led JSW Steel alone accounts for around a fifth of India’s total steel production capacity of 65 mt annually.