Karnataka mining firms to seek apex court stay on ban order

BANGALORE - About 40 mining firms in the state will appeal in the Supreme Court for staying the judgment of the Karnataka High Court upholding the state ban on export of iron ore, an industry representative said Friday.

“We are keeping all options open. We will expeditiously explore approaching the Supreme Court for a stay on the high court order as the ban on export of iron ore is affecting us severely,” Federation of Indian Mineral Industries (FIMI) vice-chairman Basant Poddar told IANS.

A division bench of the high court, headed by Chief Justice J.S. Cheer and Justice S. Abdul Nasser earlier upheld the state government’s twin orders of July 26-28, prohibiting export of iron ore from 10 ports across the state and stopping issue of mineral dispatch permits for transporting iron ore meant for export.

Expressing disappointment over the court ruling, Podder said the Federation would read the full judgment and decide on the prayer to be made in the apex court for staying the ban. “We are surprised, how the government order could have been upheld. Though it was primarily meant to curb illegal mining, legal miners have got trapped in the cross-fire,” Podder lamented.

Leading mining firms, including Seas GAO & Mineral Enterprises Ltd, Lakshminarayana Mining Co, Deccan Mining Syndicate, V.S. Lad & Sons, Kariganur Mineral Mining Industry, S.B. Minerals, Kumaraswamy Mineral Exports and Hothur Traders filed the writ petitions against the state government’s ban orders in August.

The government issued the twin orders in a bid to curb illegal mining of iron ore in the state for export, especially to China, where demand for low-grade iron ore in the form of fines and pellets is huge.

“Though the court has given the state government six months to put in place measures to curb illegal mining, we will sink into deeper crisis, as the cumulative loss in the last four months has mounted to Rs.5,000 crore (Rs.50 billion).

“Besides the industry is suffering heavy losses due to suspension of all mining activities, the state and central governments have lost about Rs.2,000 crore revenue in the form of customs duty, port handling charges, railway freight, forest development tax, royalty and local taxes since August.

“Indirect losses to the local industry in the value chain is estimated to be about Rs.800 crore, with hundreds of workers laid off due to nil mining activity,” Poddar claimed.

The bench, however, directed the state government to put in place within six months (by Jan 28, 2011) of issuing the orders necessary measures to curb illegal mining activity, including transportation and storage of iron-ore for export.