'e-auction causing mining monopoly'

'e-auction causing mining monopoly'

Sponge iron industries hit hard, says Hegde

Former Karnataka Lokayukta Justice Santosh Hegde said on Thursday that the mining industry can survive only if it adopts sustainable mining practices while paying special attention to the conservation of the environment.

Speaking on ‘Rebuilding Karnataka: Investors’ Angle, Logistical Issues and Sustainability’, at a two-day annual conference organised by Ore Team, Justice Hegde, known for his previous efforts in exposing illegal mining in the State, reiterated that iron ore exports should be banned and that mining leases should be allotted to only those who have steel plants.

“At the current time, the government does not get much revenue from exports. So, if export is banned and mining leases are allotted to steel plant owners, there will be no scope for illegal mining. The export ban will also ensure that the availability of raw materials to domestic steel plants is adequate,” he said.

Hegde added that aside from holding meetings on its various requirements, the industry should also discuss the rights of local people who have been affected by mining activities.

Hit hard

Earlier, the Karnataka Sponge Iron Manufacturers Association president T Srinivasa Rao said that the newly-introduced e-auction system for supplying iron ore to industries has hit the sponge iron manufurers hard. The new system has created a monopoly. Large steel plants have been dominating the auction. Sponge iron mills have not been able to match the prices quoted by the big companies in the auction, he added.

“Like the cement sector, the mining sector has been monopolised by a few companies. Only the big players run the show. Instead of addressing the problem, the government is allowing the monopoly. They are not even ready to listen to problems. Both politicians and bureaucrats seem to be deaf,” he said.

It is believed that raw materials became scarce for sponge iron plant owners after e-auction came into being. About 50 per cent of the 65 sponge iron mills in the State have either stopped operations or on the verge of closure, according to Rao.

Karnataka’s mining policy does not have any provisions for the allocation of captive mines to sponge iron mills. “This is a hindrance. The State government should bring in suitable amendments in the interests of the mills,” Rao said.

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