he Railways' recent move to augment transportation charges by Rs 100 a tonne has hit the exporters of iron ore hard, that too for the second time in a span of a few days, according to Exim News Service.

Only a few days ago, the Finance Minister, Mr Pranab Mukherjee, had raised the duty on iron ore exports to 20 per cent on all grades.

Iron ore exporters will now have to shell out a distance-based charge of Rs 1,600 for transferring a tonne of iron ore by rail. In the last two months, this is the second time that the Railways has increased the distance-based charges, which is levied over and above the basic freight rates. Earlier, the Railways had raised the rates by Rs 500 to Rs 1,500 a tonne in January.

Mr R.K Sharma, Secretary-General of the Federation of Indian Mineral Industries (FIMI), fears that exports may come to a halt due to such hikes.

"The latest hike will further squeeze the margins of exporters," he opined.

According to iron ore exporters, the recent hike in export duty on iron ore fines and lumps, to 20 per cent, will make exports unviable.

Iron ore exports for April 2010-January 2011 dipped by 18 per cent to 75.1 million tonnes, as compared to 91.7 million tonnes in the same period last year.