No change in export policy of iron ore pellets; opinion under review: Govt

The government on Thursday said there has been no change in the export policy of iron ore pellets not manufactured by Kudremukh Iron Ore Company Ltd, rebutting charges levelled by the Congress that Rs 40,000 crore worth of the product was exported in violation of rules by some private players, causing loss to the state exchequer.

Issuing a clarification, the Department of Commerce said that a notification, dated September 26, 2014, was issued, as per which the export policy of iron ore pellets manufactured by Kudremukh Iron Ore Company Ltd (KIOCL) was amended to 'free' from 'canalised'.

In that notification, a policy condition was also added that the export of the pellets manufactured by KIOCL is to be done by KIOCL, Bangalore or any entity authorised by them, it said.

"However, there has been no amendment to the export policy of Iron Ore Pellets not manufactured by KIOCL," it added.

The government also clarified that the legal opinion from Deputy Legal Advisor, Department of Legal Affairs "has not been endorsed" by the senior officials of the department and cannot be taken as the official legal view on this matter. "The matter for final legal position is under consideration," it said.

Congress spokesperson Pawan Khera alleged that the Modi government changed export laws to "favour some corporates" after it assumed power in 2014.

He alleged that the government removed the 64 per cent concentration cap on iron ore and allowed public-sector KIOCL to export the ore to countries like China, Taiwan, South Korea and Japan.

Khera cited a note of the Ministry of Law and Justice, issued on September 10, specifying that permission to export iron ore pellets was only given to KIOCL and not to any other entity.

The commerce ministry, which deals with issues related to foreign trade, stated that as per the export policy, items not mentioned specifically in the export schedule are free for exports.

"As per export data, iron ore pellets were taking place even prior to change in export duty in 2011-12...Thus, the linkage to changes in 2014 notification is misleading and is not backed by data," it added.

Further, it said that the legal opinion from Deputy Legal Advisor, Department of Legal Affairs "has not been endorsed" by the senior officials of the department and cannot be taken as the official legal view on this matter.

"The matter for final legal position is under consideration," it said.

According to the clarification, India exported 1,48,76,270 tonnes of these pellets during 2004-2014.

It added that to promote the export of pellets as a value added product, then Finance Minister Pranab Mukherjee, had reduced export duty to 'nil' during the 2011-12 budget.