The Supreme Court order is unlikely to bring any big relief to metal and mining companies. With the global markets in the grip of a slowdown, export of iron ore from the country has already hit an all-time low level of 18 million tonne in 2012-13 and any increase in production post the ban is unlikely to get ready market either in the country, where steel makers are going slow on their expansion, or abroad. Before the mining ban in July 2011, the country used to export around 100 million tonne of iron ore on a production of just over 200 million tonne. Since then, not only the exports have fallen but domestic production has also been hit, declining to a level of about 120 million tonne. This fall has not only been on account of mining ban but also because of a sluggish steel market that resulted in several projects getting delayed and investors withdrawing from a few others. A high-level working group headed by Planning Commission member K Kasturirangan has recommended that around 60,000 sq km of Western Ghats, spread across six states, should be turned into a no-go area for commercial activities like mining, thermal power plants, polluting industries and large housing plans. If this is implemented, it could severly constrain mining activities in Karnataka and Goa. “This is just a token relief that will not help the mining industry. Most of the iron ore lies in the category C areas where the ban continues,” Federation of Indian Mineral Industries secretary general R K Sharma said. The apex court ruling has allowed opening of 63 mines in the Category B areas but with these being smaller mines, the industry feels there will not be a significant increase in production. “Sesa Goa’s mines in Karnataka with a capacity of 2.3 million tonne is likely to commence production once it complies with R&R. We believe it could take at least six months for meaningful production to commence from Karnataka mines” Bhavesh Chauhan, analyst from Angel broking said. Before the ban, Karnataka used to produce 50-55 million tonnes of iron-ore from 166 mines. After all of the category A and B mines become operational the state will be only able to produce around 20-24 million tonnes of iron ore from 115 mines. “Category B mines are small in size, therefore the operational mines will be only 50-60. The steel industry in the state requires around 32 million tonnes of iron-ore, so there will still be a supply short fall for steel makers,” Sharma added. Steel makers in Karnataka, who used to produce about 17-18 million tonne of ore every year before the ban, have been facing severe iron ore crunch due to the mining ban. Most of the producers, including JSW Steel, which is the largest producer in Karantaka with 10-million tonne annual capacity, have been running their plants at a reduced capacity due to shortages as stocks were limited, while the quality was lower. Steel majors like Tata Steel and SAIL expect steel demand to improve in the country and expect demand growth to be nearly 6-8% in the current fiscal with the pace picking up from the next fiscal. The timing of the mining ban relief and revival in the steel industry thus coincides. But this is expected to be a long-drawn process. “As economy is expected to get back to growth mode, the opening up of mining will enable raw material linkages for further investments in steel sector in Karnataka region,” said Seshagiri Rao, joint managing director, JSW Steel. The new areas that have now be brought under production as per the apex court's judgement will increase the total production of ore top just about 16-17 million tonne per annum, less than 40% of the production before the mining ban came into force.