Sharmili Mallick

The Utkal Chamber of Commerce And Industry (UCCI) and Orissa Sponge Iron Manufacturers’ Association in Bhubaneswar have jointly appealed the Odisha Government to save the Micro, Small and Medium Enterprises (MSMEs) in steel sector and livelihood of lakhs of people in the State by reserving minimum 50 percent iron ore for Odisha-based steel industries under its pre-emption scheme.

Amid the alleged acute scarcity of iron ore and reports of closure of several MSMEs in Odisha, the UCCI and Sponge Iron Manufacturers’ Association stated that 60 percent iron ores are diverted outside State despite protest from local industry.

“Merchant mines are profiteering as iron ore prices skyrocket in Odisha while several sponge units have been closed due the scarcity of iron ore, because of which thousands of jobs are in peril,” stressed the UCCI and Sponge Iron Manufacturers’ Association.

“Only pre-emption can save industry by doing real value addition in the State and will general more State revenues and employment for local youths,” suggested the UCCI and the apex body of State’s Sponge Iron industry.

“There are around 100 small and big plants in Odisha. As we are facing acute shortage of iron ore at present, we request the State Government to redirect the mines owners to channelize only 50 per cent of their products outside the State while they have to reserve the rest for the State-based industries,” said the president of Odisha Sponge Iron Manufacturing Association, Yogesh Dalmia.

Similarly, UCCI president Brahmananda Mishra said that the State Government had earlier defended the pre-emption policy where the mines owners in the State had to reserve 50 per cent of their raw materials for State-based plants.

“The State-based steel industries and sponge iron units have been generating employment in the State and helping in industrial growth. If we cannot provide them adequate iron ore, they will close their set up which will have several adverse effects,” added Mishra.

In 2012, the Odisha government had announced the pre-emption policy in order to ensure the availability of raw materials in State industries. A formal notification giving first rights to State industries on minerals was issued in 2014.

Meanwhile, the Federation of Indian Mineral Industries had (FIMI) had moved the High Court and Supreme Court opposing the move. However, the courts had issued order in favour of the State government. 

As per the pre-emption policy, 50 per cent raw materials of the State should be reserved for native industries. The State industries should get the materials as per the price fixed by the Indian Bureau of Mines. 

Industrial Expert Bhawani Shankar Pani said, "The government should ensure proper implementation of its own policy so that the industries of our State are saved. At present, the economic condition is not good. If the industries set up here do not get adequate raw materials, new investments will not come to the State."

Steel and Mines Minister Prafulla Kumar Mallik said, "The issue has come to my notice and I have already directed officials to examine it. We supply adequate raw materials to all. If needed, we will hold discussions with the industries and resolve the issues."