Chhattisgarh based steel mills should get priority for securing minerals under the pre-emption policy to deal with the ongoing crisis of shortage of iron ore in the state, said Naveen Jindal, Chairman of Jindal Steel and Power limited (JSPL) at the Chhattisgarh Mining Summit, organized by PHD Chamber of Commerce & Industries, on June 16.
Jindal said that if the pre-emption, or first right provision, is implemented under the Mineral Concession Rules-2016 under rule number 12(1)(I) in Chhattisgarh, the ongoing crisis can be solved.
Under the given provision, the exemption gives the state government the right to stop supplying minerals to other states and abroad to ensure adequate supply to the state-based industries. The provision is applicable in the state of Karnataka, where mills are being ensured availability of raw material.
VR Sharma, Managing Director, JSPL said about 85pc of iron ore from Chhattisgarh is sent to outstation market and rest 15pc is available to the state-based mills, which is insufficient. There are two large steel mills located in Chhattisgarh ie Bhilai Steel Plant (BSP), a subsidiary of Sail, and JSPL in Raigarh. He also said that there many private sector steel units in the state which requires 20mn mt of iron ore annually.
There are many small and medium scale steel units located in Raipur and Raigarh, that have the potential to double their production by 2025 provided sufficient raw materials is available to them.
In the long run, Chhattisgarh can contribute around 60mn mt of steel out of national target of 300mn mt by 2030.
In just last one year, iron ore prices have gone up by 500pc in Odisha and by 350-400pc in Chhattisgarh.