Supreme Court lets Goa state resume sales of iron ore

NEW DELHI (Reuters) - India's Supreme Court gave the go-ahead on Monday for the auction of around 11.46 million tonnes of iron ore already mined in Goa, potentially doubling the country's exports this year to top market China.

The court also said it would set up a panel to decide on a cap for Goa's iron ore output and this should submit an interim report by February 15, 2014.

"We are setting up a six-member expert committee to study the cap on production based on carrying capacity of roads and such," Justice A.K. Patnaik said in the Supreme Court

India used to be the world's third-largest exporter of iron ore, shipping out ore worth more than $7 billion per year, with much of that from Goa state. But restrictions in Goa and neighbouring Karnataka to clamp down on illegal mining have slashed ouput and exports.

India's shipments to China have slowed to a trickle at just over 8 million tonnes from January to September, down 75 percent from a year before.

Most of Goa's iron ore goes to China, fetching about $75 per tonne for low-grade ore of less than 52 percent iron content.

(Reporting by Krishna N Das and Suchitra Mohanty; Additional reporting by Swetha Gopinath in Bangalore; Editing by Alan Raybould)