Steel units in Odisha seek priority in iron ore auctions

Justify demand saying they have invested Rs 2 lakh cr in the state and employ one milliion people

Steel units that have invested significantly on their projects in Odisha have sought preference in the upcoming iron ore auctions.

"Steel industries have invested thousands of crores into their units in the state. More than Rs two lakh crore has been invested and one million people have been employed. About 30 million tonne of steel capacity has already been created or going to be created in the state. We believe that such units should be given priority in the upcoming iron ore auctions so that they can run their units efficiently. Presently, the steel companies are running their units at barely 50 per cent of their capacity", said Naveen Jindal, chairman of Jindal Steel & Power Ltd (JSPL).

According to Section 6 (3) of Mineral Auction Rules, 2015 under Mines and Minerals (Development & Regulation) MMDR Amendment Act, 2015, state governments are empowered to decide the end use of a mineral lease.

"Iron ore mines need to be auctioned as soon as possible, And, the steel units that have invested huge money in Odisha need to be given preference in iron ore auctions. As per Mineral Auction Rules, the state government can decide the end use of a lease. We want that more mines should be earmarked for captive use compared to merchant category", said Sanak Mishra, secretary general, Indian Steel Association (ISA).

The ISA consisting of top officials drawn from steel companies like JSPL, Jindal Stainless Ltd (JSL), Essar Steel and Bhushan Steel called on chief minister Naveen Patnaik today to apprise him on an array of problems faced by the steel industries.

"Steel units in the state are running into losses. Production of iron ore by state owned Odisha Mining Corporation (OMC) and the merchant miners need to be scaled up. This will ensure optimum availability of iron ore and also balance prices. There should also be relief on steep water charges. Water charges on steel units should be on actual consumption instead of allocation", Mishra said.

Jindal stressed on rationalisation of royalty rates of iron ore.

"In Odisha, the highest royalty rate is levied even on low grade ore. This has led to piling inventory", he said.