KOLKATA (miningweekly.com) - The Indian government has denied any scarcity in domestic availability of iron-ore and refuted reports that the country would be a net importer by 2020.

“There will be no shortage of iron-ore, even in 2020, when Indian steel production is projected to rise to 100-million tons a year,” Mines Minister Dinsha Patel said.

“Indian steel production is about 67-million to 70-million tons a year. It requires 1.6-million tons of ore for producing one-million tons of steel. Indian iron-ore production was 210-million tons in 2010 and came down to 167-million tons following a ban on mining in Karnataka. Even then there is no dearth of iron-ore,” he said.

Iron-ore production in the country has been steadily falling in the wake of a ban imposed in the southern Indian province of Karnataka a year-and-a-half ago, and a similar ban across the western Indian coastal province of Goa in October 2012.

Mining was currently permitted in the eastern province of Orissa but with severe restrictions on transportation.

Indian iron-ore exports during the ten-month period between April 2012 and January 2013 were down 68% to 16.35-million tons, compared to the corresponding previous period.

According to an official in the Mines Ministry, the government’s denial of the iron-ore shortage for domestic steel production was prompted by a series of reports put forth by analysts over the past few months, which predicted that India would turn into a net importer of iron-ore as early as the next fiscal year.

The official said that the mining industry’s contention that the quantity of iron-ore imports was higher than exports, indicating a shortage of raw material, was fallacious.

It was pointed out that Indian exports consisted almost entirely of iron-ore fines which were not used by domestic steel mills, while imports were largely of high-grade lumps. Since the two were not comparable, higher iron-ore imports than exports did not have a major implication on domestic steel production since domestic availability of lumps, barring a few geographies, was not impacted.

The Mines Ministry also doubted the accuracy of export-import projections made by the Federation of Indian Mineral Industries, the mining industry lobby group. While it had forecast double-digit iron-ore imports of between 10-million to 12-million tons during 2012/13, the actual figure was expected to be around eight-million tons.

As for exports, while the industry body had been forecasting a single-digit volume, the actual export in 2012/13 was expected to close at between 17-million and 18-million tons.