The Supreme Court (SC) on Thursday lifted a one-and-a-half-year old iron ore mining ban in Karnataka. As per the CEC reports, Category B mines will be allowed to restart mining subject to necessary statutory clearances and completion of relief and rehabilitation work is complete.
Welcoming the verdict, Vinod Nowal, director & CEO, JSW Steel said it will take around 1-3 months for the company to start mining at B category mines. "It is a good sign for the industry and iron ore availability will increase by another 6-7 million tonne," he told CNBC-TV18.
Below is the edited transcript of his interview to CNBC-TV18.
Q: With this verdict of opening up of category B mines, how much time will it take to increase iron ore production?
A: Opening up of category B mines is a welcome step. It will take around 1-3 months to start old b category mines. It is a good sign for the industry and iron ore availability will increase by another 6-7 million tonne.
Q: For JSW Steel how will it help in improving the capacity utilisation. What does it stand at currently?
A: So far we were buying low grade material and at the same time importing and buying from other states a higher quote. Now the higher quote material will be replaced with less grade material and this will benefit the industry.
Q: How much impact would it have on earnings?
A: When we source material form other state we incur a cost of Rs 3,000 as freight against local freight of Rs 500-600. Definitely, there will be benefit.
Q: On an annual basis how much iron ore will the Karnataka state?
A: From B category mine Karnataka will get around 6-7 million tonne on an annual basis.