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Indian Railways has slashed the cost of transporting iron ore exports for the first time since March of 2012, according to The Economic Times.
"There has been significant change in market of export of iron ore and hence the issue of [distance-based charges] has been reviewed. Accordingly, the central government has accorded sanction for revising the distance-based charge leviable on booking of iron ore traffic meant for other than domestic consumption over all distance slabs," said the Director, Traffic Commercial (Rates) of the Railway Board, in a circular.
The revision comes as India’s domestic mining sector attempts to rebound from struggles over the past three years due to higher export costs and a steep fall in commodity prices during recent months. These steps should help increase the country’s iron ore exports to Japan and South Korea; however, the country’s sector could continue to struggle as India still has some of the world’s highest export duty and taxes.
"The initiative is aimed at reviving exports, but we do not expect any big impact due to a crash in global prices, the existing export duty and high logistics costs," said ND Rao, chief of the Pellet Manufacturers' Association of India.
Between 2012 and 2015, the country’s export of iron ore tumbled 80% from its peak of 90 million tons per year due to China’s reduction in demand and Australia’s pricing. Targeting a revival in exports, the transportation cost reduction is expected to help put the country’s largely unused capacity back to work. (Source: The Economic Times)
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