Karnatakas steel producers have called for resuming mining in the Bellary district,saying that there may be social unrest as lakhs of workers would be unemployed. They have asked the National Manufacturing Competitiveness Council (NMCC) to initiate talks with the central governments steel,mines and environment ministries and the state to redeem the situation.
In a letter to the NMCC chairman V Krishnamurthy,the Karnataka Iron and Steel Producers Association (KISMA),said major producers like JSW,Kirloskar Ferrous and Kalyani Steel have set up their projects with huge investments only on account of proximity and availability of iron ore. All these plants put together produce around 24 per cent of the countrys annual crude steel production and are squarely dependent on iron ore supply from Karnataka.
It pointed out that the Supreme Court through its various orders has allowed 2.5 million tonne of iron ore to be made available to local steel but its orders have not fulfilled in letter and spirit.
The association said while the court asked NMDC to produce 1 MT per month from its Donimalai and Kumaraswamy mines and dispose of 1.5 MT monthly from the stockyards through auction,but since October 2011 the average dispatch from NMDC has been 0.60 MT per month.
Karnatakas steel producers have now begun looking for procuring iron ore from Orissa and Chhattisgarh as the minerals quality from neighbouring Goa is inferior.
Any interruption in operations without any visibility on supply of iron ore to the steel industry in the region would result in 80,000 direct and several lakhs of indirect unemployment. It shall pose the threat of creating a social unrest in the society at large, KISMA said. It said that this will have ripple effects like high inflation.