Two days after the Indian High Court allowed 18 iron ore mines to resume mining activities in Karnataka, India, the government now considers reducing export taxes on its iron ore shipments.

Mines Secretary Vishwapati Trivedi on Tuesday said the government is also thinking to slash taxes on railway freight, saying the two tax reduction scheme, along with resumption of mining activities in Karnataka, could help recover India's outbound shipments of the key steel-making material.

India's iron ore exports in the year ended March 31, 2012 fell more than a third to 61.8 million tonnes.

Mr. Trivedi, however, did not provide a definite timeframe on when the changes could possibly be effected.

"We will try as soon as possible," Mr. Trivedi added.

Last year India imposed a mining ban in Karnataka on environment concerns brought by rampant illegal mining. The ban lasted more than a year. The High Court on Monday reversed the mining prohibition ruling, thus, spells a mining resumption that could mean 5 million tonnes a year of renewed production.

The reduced exports were triggered by the cut back on production. Indian miners find it hard to sell their iron-ore fines or inferior grades in the local market Indian steelmakers still lack the proper technology to use them.

"There's a case for export of [low-grade iron-ore] rather than dumping [it] and spoiling the environment," Mr. Trivedi said.

Nearly 2.31 million tonnes of iron ore from the 18 Category A mines are expected to pour in within the next two months.

The ban lifting was a much welcomed development since iron ore inventory in the state had reached down to a remaining one month's consumption.

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Indian Iron Ore Mines to Resume Operations After High Court Lifts Ban