Export duty on low-grade Iron ore would hit Goa hard, GMOEA tells centre

Goa Khabar : The Goa Mineral Ore Exporters’ Association (GMOEA), a representative body of key stakeholders of the Goan mining sector for more than 60 years, has written to the Government of India expressing deep concerns over reports suggesting an imposition of export duties on low-grade iron ore (below 58% Fe), a move that could have significant and adverse implications for the State of Goa.

In a formal communication to Piyush Goyal, Secretary to the Government of India Ministry of Mines, the Association urged the Government of India to not consider any such move, highlighting that it could severely disrupt mining operations in Goa, where iron ore is predominantly of low grade.
The representation underscored the rationale for export duty exemptions of low-grade iron ore. Proposals to extend export duties across all grades are being advanced by sections of the steel industry to gain cost advantage in sourcing the raw material (iron ore) Delayed operationalising auctioned iron ore leases might also have added to the sentiments of steel producers.

These issues of perceived or artificial scarcity would be better addressed and resolved at the regional level and by enhancing supply. Conditions in Goa and the wider Konkan region, including Sindhudurg, are materially different.

Appealing to Government, Glenn Kalavampara, Joint Secretary, GMOEAsaid “Goan iron ore essentially being of lower grade & higher impurities has historically been export oriented due to limited scope for domestic consumption.

Adhoc and frequent fiscal interventions such as imposition of export duties on low grade below iron ore (58%fe) create significant uncertainties and affect government revenues for Konkan regions with constrained market access and limited price realisation for such material.

On the contrary, all efforts should be made to ensure operationalisation of auctioned iron ore mines to augment production.”
Goan iron ore has distinct characteristics: the average grade is around 54% Fe, with virtually all production below 58% Fe. These ores are largely unsuitable for domestic steelmaking, as higher-grade alternatives are available elsewhere. Even pig iron and pellet units in Goa rely on higher-grade ore from outside the state or imports. Goa’s production is predominantly fines-based and seasonal due to heavy monsoons,
Also, a special assistance package of ₹400 crore has recently been granted to Goa by the Central Government to support commencement of production from auctioned mineral leases. Such support is welcome and should help address industry bottlenecks.

The representation noted that the Ministry of Mines has been proactively engaging with state governments to resolve issues related to the operationalisation of auctioned mines, particularly in regions critical for domestic supply. At the same time, domestic iron ore production has shown steady growth. In this context, faster and more streamlined statutory clearances would significantly aid timely commissioning and improve overall outcomes.

With additional iron ore blocks being auctioned nationwide and the remaining auctioned mines commencing operations, the supply outlook appears well positioned to strengthen further. This momentum has been supported by reforms under the MMDR Amendment Act, 2025 (effective 21 August 2025).

The resumption of mining in Goa following auctions has been challenging yet encouraging. Of the 12 auctioned blocks, five have commenced production, with several more expected to start operations within the current financial year. The state government also intends to auction additional blocks before the end of the fiscal year.

At this sensitive stage, the imposition of any additional levy, such as export duty, would undermine project viability, deter competitive bidding, reduce state revenues, and jeopardise ongoing operations. The original intent of export duties—to preserve higher-grade ore for domestic steelmakers has already been met through existing levies on ores above 58% Fe.

Goa operates under a Supreme Court-mandated production cap of 20 MTPA and even at full capacity would contribute a small proportion of India’s overall iron ore production which was ~290MT in 2024-25. Domestic self-sufficiency therefore remains unaffected. Export continues to be a viable option for low-grade ore, and encouraging such exports aligns with national trade interests.

The representation reiterated and requested that low-grade iron ore (<58% Fe), fines and lumps from Goa and the Konkan region remain exempt from export duty, with the prevailing NIL duty policy retained. The letter also welcomed the continued engagement with the Central Government to address regional concerns while remaining aligned with national objectives.