India: Govt reviews reforms to strengthen iron ore supply and steel competitiveness

• Strengthening India's iron ore supply through rule amendments, enhanced clearances
  
  
• Propose uniform duty on iron ore exports from Oct'25 to safeguard domestic needs
  
  

India's iron ore production stood at 289 mnt in FY'25, driven by the rapid expansion of steelmaking capacity and domestic demand. BigMint projects crude steel output to reach - 225 mnt by FY'30, with hot metal production rising to ~140 mnt (from 91 mnt in FY'25) and DRI output to 67 mnt. To support this growth, iron ore supply must scale up significantly, requiring an annual capacity addition of 30-35 mnt. Against this backdrop, a recent meeting was convened to deliberate measures for augmenting production.

A high-level inter-ministerial meeting was convened in New Delhi earlier this week under the chairmanship of Union Ministers Piyush Goyal, G. Kishan Reddy, Bhupender Yadav, and Jitin Prasada. The meeting on 'Reforms to boost production of iron ore and steel' was attended by senior bureaucrats from across the Centre and States, as well as leading industry stalwarts.

A 15-member committee will be constituted to meet fortnightly for examining all concerns, with a monthly review conducted at the CIM level.

Piyush Goyal set the tone by outlining three key priorities:

• Boosting steel exports from India - India must aim to export 50 million tonnes of steel exports.
  
  
• Strengthening India's iron ore supply - The government suggested tightening enforcement against successful bidders of iron ore blocks who fail to commence operations. An amendment to the Mineral Concession Rules, 2016, is under consideration to enable sales of iron ore from auctioned mines beyond MDPA through State and Central PSUs.To augment supply, NMDC is being granted enhanced environmental clearances along with access to new virgin mines, while OMCs Guali mine will see increased EC supported by slurry pipeline and related approvals. A comprehensive slurry pipeline policy is also under discussion, with proposals to raise EC limits for other OMC mines. In parallel, the government is moving to auction around 20 million tonnes of seized ore from old lessees, and the issue of SAILs Gua dump sale is being taken up with the Chief Minister of Jharkhand.
  
  
• Rationalising costs - With India targeting 50 mnt steel exports annually, India's iron ore production is required to increase drastically and Indian iron ore prices should be reduced to 50% from current levels. If these two points are met, India should export four times iron ore from current levels else export duty shall be imposed on iron ore (all grades and its derivatives) from as early as October 2025.

  Ministry of Mines has suggested simplified, transparent methodology for computation of all India ASP. Industry body suggested to reduce the factor for lump to be 1.1 of derived iron ore fines price for respective grades. Accelerated implementation of such methodology as opined by Ministry of Mines, will address the anomalies and speculation in datapoints for IBM assessment for ASP.
  
  

• Lowering iron ore exports from India - Imposition of uniform export duty on export of iron ore across grades from 2 October'25 if there is no increase in iron ore production and decrease in iron ore prices. Exports of iron ore will be permitted only after ensuring domestic requirements are fully met.
  
  
• Strengthening ease of doing business - A possible shift in auction methodology towards a fixed premium model, with upfront payments for transparency. Additionally, a proposal for uniform premium allocation across participants.
  
  

With these measures, the government seeks to balance raw material availability, boost steel exports, and strengthen Indias global competitiveness. Industry participants now await final policy announcements, expected to reshape the domestic iron ore and steel ecosystem in the near future.