The Associated Chambers of Commerce and Industry of India (ASSOCHAM) has urged the Indian government to reduce iron ore prices by about 25 percent to help the domestic steel industry become competitive.
"Asian economies like China, Japan and South Korea have become more competitive and are exporting steel to India at dumped prices due to lower iron ore prices, thereby creating a huge problem in India and posing a threat to the survival and sustainability of the domestic steel industry," noted ASSOCHAM in a communication addressed to Narendra Singh Tomar, India's steel and mines minister.
ASSOCHAM said that India's leading iron ore producer, National Mineral Development Corporation (NMDC), is charging prices 25 percent higher as compared to other iron ore miners based in Odisha, which is adversely impacting the domestic steel industry. Despite the reductions in NMDC's iron ore lump and fine prices in January this year, which are in line with those both in Odisha and the international market, the state-run miner is still charging much higher prices for iron ore fines, ASSOCHAM said.
ASSOCHAM underlined that India's steel industry is under severe pressure, on account of the sluggish economic recovery and various factors impacting the external and internal environment like higher prices of iron ore, due to its shortage in the country owing to the Supreme Court's intervention.