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Slowing global economy will affect Indian iron ore exports - Dr Firoz

Painting a bleak picture, the steel ministry said that iron ore exports will be under pressure and overall growth of the industry may be affected due to global competition and market forces over the next five years.

Dr AS Firoz chief economist ministry of steel economic research unit said that it is not government policy but market forces that will result in a decline in iron ore exports from the country, which are currently pegged at 120 million tonne.

He said that "It (iron ore export) would decline to 30 to 40 million tonne by 2016.”

Dr Firoz said the steel and raw material industry was passing through a tough phase and new ideas are required to steer it ahead. He added that "Global economies are not doing well. The Chinese economy will also come under pressure, resulting in the reduced demand of iron ore, as it will also affect growth of the steel industry.”

The official claimed that "Even if there is a demand, the exports would be an unviable proposition, considering the infrastructural costs. If the price is USD 100 per tonne of iron ore, most of the mining companies could able to achieve only a break even adding that taking into consideration current road and railway freight charges, nobody would be making money.”