Increase in India's export duties on iron ore, pellets to raise costs for steel mills: Moody's

India's imposition of higher export tax on iron ore and various intermediate products such as pellets will raise costs for steel mills, Kaustubh Chaubal, vice-president, corporate finance group, Moody's Investors Service, said on Monday.

However, strong domestic steel demand provides arbitrage opportunity for a portion of such exports to be diverted for domestic finished steel production, Chaubal told Reuters over e-mail.

The government raised export tariffs on new iron ores and concentrates to 50% from 30%, and duties on pellets to 45% from zero. The government also removed import tariffs on coking coal and coke.