Monday, November 29, 1999

India illegal mines drive to hit iron ore supply

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The government plans to expand its crackdown against illegal mining to several states, a move that could lead to supply shortage of iron ore, a key steel-making ingredient, a senior official said on Friday."Initially it might cause a dip (in iron ore production) as people will have to make sure they comply with all the rules," Santha Sheela Nair, secretary in the mines ministry, told reporters after a meeting of state and central government officials.Nair named 10 states including Andhra Pradesh, Chhattisgarh and Karnataka where the government would "intensify" its drive against illegal mining in coordination with several government departments.Orissa, a major iron ore producer, has closed about 60 mines over the past one year for not possessing proper licences.However, iron ore output is unlikely to take a hit in the full year as new mines would open up, Nair said.The country produced 226 million tonnes of iron ore in the fiscal year ended March, compared with 215 million tonnes in the prior year, according to data by the mines ministry.India has about 500 iron ore mines, only a handful of which are large captive mines belonging to steel companies.Separately, Nair added that the draft of a new mining bill is likely to be presented before the group of ministers within 10 days, after which it will go to the cabinet and the parliament for approval.The bill seeks to make mining companies pay more to local people.(Reporting by Ruchira Singh; Editing by Unnikrishnan Nair)
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