Odisha’s District Mineral Foundation fund collection highest in country

The Times of India | March 11, 2021
BHUBANESWAR: Odisha has collected the highest amount of Rs 11,984 crore among all the states under the District Mineral Foundation (DMF) fund since it was created in 2015, Union mines minister Pralhad Joshi told Lok Sabha on Wednesday.

Till January, a total of Rs 45,095.86 crore in DMF fund was generated in the country. Odisha got more than one-fourth of the share, the minister’s written reply revealed. Neighbouring Jharkhand (Rs 6,533.04 crore) and Chhattisgarh (Rs 6,329.78 crore) managed to collect the second and third highest amounts under DMF. Rajasthan is fourth, having collected Rs 4,496 crore.

The funds are contribution from mining companies operating in the respective districts, which has been mandated under the Mines and Minerals (Development and Regulation) Amendment Act, 2015. The mining companies pay 30% equivalent of the royalty amount for leases given before 2015 and 10% for leases granted after that when auction of mines and mineral blocks started.

A government officer said Odisha being a mine-bearing state, it is natural for it to garner the maximum amount, the bulk coming from coal, iron ore and bauxite.

Against an available amount of Rs 11,984 crore, the state has spent Rs 5,364 crore by January this year. The amount spent is also the highest in the country, though in percentage terms the state’s spending at 44.76% is marginally less than the national average of 45.10%. Countrywide, Rs 20,337.35 crore has been spent from DMF fund. Chhattisgarh has spent the highest 69.04% (Rs 4,370 crore) followed by Tamil Nadu at 54% (Rs 413.29 crore).

The ministry of mines had circulated guidelines for implementation of Pradhan Mantri Khanij Kshetra Kalyan Yojna (PMKKKY) in September 2015 on the use of DMF fund.

Though DMF has been constituted in all districts in Odisha, the seven districts of Keonjhar, Sundargarh, Jajpur, Angul, Jharsuguda, Koraput and Rayagada account for 90% of the funds. Some of the districts such as Sundargarh and Keonjhar used DMF fund for enhancing Covid care infrastructure. Many districts have used the funds to strengthen primary health centres besides livelihood and nutrition support programmes, among others.

No plan to increase coal royalty for Odisha: Union minister Pralhad Joshi

The New Indian Express | Feb 11, 2021
The Centre has made it clear that there is no plan to increase royalty on coal and non-coal minerals for states like Odisha.

BHUBANESWAR: The Centre has made it clear that there is no plan to increase royalty on coal and non-coal minerals for states like Odisha. Replying to a question from Sasmit Patra (BJD), Union Minister for Coal and Mines Pralhad Joshi told Rajya Sabha that at present, states concerned are collecting royalty at 14 per cent (pc) ad-valorem on price of coal.

In addition, contribution towards District Mineral Foundation (DMF) at 30 pc of the royalty in respect of mining leases granted before January 12, 2015 and 10 pc on or after January 12, 2015 is also being collected by the states.

The Minister said due to ad-valorem nature of rates of royalty, there is increase in revenue to the coal producing states as and when price of coal increases. The decision has been taken basing the report of a study group constituted on July 21, 2014 for examining the issue of revision of royalty rates on coal and lignite.

The study group had submitted its report suggesting no change in the rates of royalty which the Centre accepted, he said. Chief Minister Naveen Patnaik during a virtual meeting with Joshi and Union Minister Dharmendra Pradhan in December 2020 had made a strong plea for revision of royalty for coal and non-coal minerals.

Chhattisgarh Government’s English Medium Schools Runs Out Of Seats Amid High Demand

The Logical Indian Crew Chhattisgarh | 26 Jan 2021
The government had received as many as 60,000 applications for admission in a span of three months but admitted only 28,000 students due to limited availability of seats.

The Bhupesh Baghel-led Chhattisgarh government’s English medium schools are in high demand in the state. To bring government-aided institutions at par with its private counterpart, 52 English medium schools under the name of Swami Atmanand, a well-known educationist from Raipur, were set up in the first phase of rebuilding the structure. According to The Print, these schools were formally inaugurated on the state’s foundation day on November 1, 2020, but the enrollment procedure had already started in August. The government had received as many as 60,000 applications in a span of three months but admitted only 28,000 students due to limited availability of seats.

“We are moving ahead to complete one of our dream projects to ensure greater access to quality education in uniquely conceptualised English medium government schools. Improving education should remain a critical area of investment and the students’ performance should be the indicator of success”, said Chief Minister Baghel, reported The New Indian Express.

Swami Atmanand English Medium Schools

The state-run schools mainly cater to the children belonging to the economically weaker section of the society. The idea behind this is the notion that access to the English language is the right of the elite. Hence such targeted measures to bring a shift in the mindset in the society plays a key role.

English is taught to students from primary classes and around 500 seats have been fixed for the same for each school till secondary level. Reports have pointed out that the school infrastructure has been refurbished with clean ambience around the campus, while the buildings have been beautified and are equipped with adequate furniture. The schools are equipped with science labs, smart classrooms and libraries stocked with inspirational literature and grounds with multi-sporting facilities would help in bettering the learning experience. Reportedly the experienced and qualified teachers are also turning to such schools in search for better opportunities and well-paying stint.

“The effort to set up government-owned English medium schools became extremely popular in the first year (2020) itself. Further admissions were stopped after enrollment of about 28,000 students before November due to jostling between the parents for admissions and a heavy influx of recommendations,” said Alok Shukla, Principal Secretary, State School Education Department. “The quality parameters of these schools were determined keeping in mind private schools and their students’ performance. It will not be proper to compromise with the quality of education by providing admissions to more than available,” he added. The government had been facing persistent demand from the public to set up educational institutions that would provide quality education with an affordable fee structure. “English learning has become indispensable for the children to keep pace with the modern world. There was a huge demand for government English medium school from parents. Also, the Chhattisgarh government believes that no child should be deprived of the opportunity for education of his or her choice mainly due to parents’ inability to pay the cost. However, there is no hurry in opening new schools as we are moving in a planned way. Other editions of the schools will be rolled out only when entire infrastructure is put in place,” Shukla explained. “I never thought my daughter could ever study in such an outstanding English medium school,” said an Ajay Pandey, resident of Mahasamund district. The Chief Minister had during one of his addresses had said that his government would work towards resolving concerns for the overall development of the state and that a lack of money will never come in the way of progress. Surprisingly, there have been reports that parents reached out to local political leaders seeking help in getting their wards enrolled in such schools. “It was quite surprising for me that almost 100 parents – from many districts including Raipur – sought recommendation from me to get their kids enrolled in government English medium schools. Apart from enrollments, parents also demanded the opening of more such schools,” said Raipur Congress MLA Vikas Upadhyay. Congress spokesman R.P Singh also shared a similar experience. “I recommended nearly 50 names for admission in these schools on parents’ requests. If the experiment of Government English medium schools succeeds, then, I must say, 25 per cent private schools in the state will have to be shut down in the coming years,” he said. The District Mineral Foundation (DMF) funds are channelised by the respective district collectors to meet the expenses. On the road ahead, the Chief Minister had said that the state is planning to raise the number of such schools from the existing 52 to 100 from the next academic session across 28 districts.

Sundargarh DMF fund finds way to non-priority sectors

The New Indian Express | Jan 16, 2021

When it comes to using the District Mineral Foundation (DMF) fund, Sundargarh district appears to have a soft corner for Rourkela.

ROURKELA: When it comes to using the District Mineral Foundation (DMF) fund, Sundargarh district appears to have a soft corner for Rourkela. The DMF guidelines are clear about priority and non-priority areas but DMF funds find their way to the Steel City which is neither directly nor indirectly affected by mining, a criteria for spending the funds.

Last year, when Rourkela Police unveiled a fleet of 25 brand new Innova Crystas to patrol the roads of Rourkela, eyebrows were raised because the multi utility vehicles were procured using 4.65 crore from the DMF. Of the 25 MUVs, 20 are meant for Rourkela while five are deployed in Bonai sub-division. Interestingly, before that the district administration is learnt to have spent 25.52 lakh from DMF pool for what it called ‘engagement of police patrolling and traffic management’ for Rourkela city, reveals information secured through RTI. How the new vehicles helped police intensify patrol is another story, given the spate of crimes that rocked the Steel City last year.

RTI activist Rashmi Ranjan Padhi citing the RTI reply said the administration spent ` 25.52 lakh towards ‘engagement of police patrolling and traffic management’ in Rourkela Municipal Corporation (RMC) limits but details were not provided, not even year of expenditure. However, reliable sources informed that the expenditure was incurred during 2017-18 towards hiring of police patrol vehicle for Rourkela.

“Rourkela city is not directly or indirectly affected by mining operation. Besides, using DMF on swanky MUVs and police patrolling makes very little sense,” said Padhi, who also is former Secretary of Odisha Pradesh Congress Committee (OPCC).As per available information, the total collection of Sundargarh DMF stood at 2,133.27 crore till June 30, 2020. Till then, at least 2,094.12 crore was spent or work orders awarded against 3,672 projects. Padhi claims that many of the spendings do not comply to DMF norms.

The mineral foundation released 78.56 lakh towards construction of main gate, boundary wall and 30 shops at Madri Kalo Bhawan of Sundargarh town. Similarly, approval was given for 64.99 lakh towards construction of boundary wall of a truck terminal at Amlipali in Sundargarh town in February 2019. In July 2020, ` 49.12 lakh was sanctioned towards raising of boundary wall and barbed fencing of Circuit House of Sundargarh town. Sundargarh Collector and DMF Chairman-Cum-Managing-Trustee Nikhil Pawan Kalyan did not reply to written request for comment.

Where is the DMF money meant for people living in mining areas going?

Mongabay | Mayank Aggarwal | 14 January 2021

In 2015, the Indian government introduced a mechanism for establishing the District Mineral Foundations (DMF) which were to drive developmental work in the mining-affected areas.
Over Rs 400 billion have been collected in the fund so far but the implementation remains poor with civil society leaders and experts complaining that transparency in use of this fund and involvement of local communities is missing.
Experts advise that for the DMF mechanism to succeed, districts must focus on the delivery of services rather than a spree of creating only infrastructure, engage local partners for implementation and focus on livelihoods based on natural resources to improve the local economy.
In Madhya Pradesh’s Singrauli district, one of the biggest and most polluted coal mining and thermal power hubs in the country, funds meant to drive development for the people living there, have been used for the construction of an air-strip. For communities that have been bearing the brunt of mining pollution, development in the form of a space for aircrafts to land, reflects the imbalance between the purpose and implementation of the District Mineral Foundation (DMF) funds.

DMFs were introduced in January 2015 by the government of India in all districts in the country affected by mining-related operations. The provision was hailed as a golden pill for the upliftment of such areas. Now, six years later, it has failed to deliver on its promise and is stuck in a bureaucratic- and politician-heavy approach.

The provision was brought through the Mines and Minerals (Development and Regulation) Amendment Ordinance, 2015 which called for establishing the DMFs in all mining-affected districts and using funds collected under this for the welfare of people of such areas. It was followed by the government, in February 2015, introducing the Mines and Minerals (Development and Regulation) Amendment Bill, 2015 to amend the 1957 version of the law in Lok Sabha which passed it in March 2015.

In September 2015, the government notified the rates of contribution payable by miners into the DMFs. It said in case of all mining leases executed before January 12, 2015, miners will have to contribute an amount equal to 30 percent of the royalty payable by them while in case of mining leases granted after that, the rate of contribution would be 10 percent of the royalty payable.

Following this, by now, the DMFs have been constituted in 574 districts in 21 states with about Rs. 41,650 crore (Rs. 416 billion) till September 2020.

The exact composition and functions of the DMFs were to be decided by the state governments but the amendment of the law had specified that use of this fund has to be in line with the provisions of the Panchayats (Extensions to Scheduled Areas) Act, 1996 and Forest Rights Act, 2006. Experts and civil society leaders note that it has not been the case.

Srestha Banerjee, who works as the natural resources programme lead with the International Forum for Environment, Sustainability and Technology (iForest), a think-tank working on environmental and sustainability issues, noted that government’s approach to ensuring the use of the money available under the DMF mechanism is top-heavy where the trusts responsible for their use are dominated by officials and politicians.

“This packing of the DMF body with politicians and officials who are to take decisions on how the DMF money should be used, with little representation of the local people ensures that the true spirit of the DMFs is not reflected in the projects that are decided in mining-affected areas. The idea enshrined in the law related to DMF was to ensure that it is used for the welfare of ming affected communities, including tribal and forest-dwelling communities, by including them in the decision-making process. The law thus required DMFs to function in line with our Constitutional provisions as related to Scheduled areas, the FRA and PESA. But that has not happened and that is among the biggest problems of the DMF so far.”

Chinmayi Shalya, an independent researcher, who has worked on the issue of DMF, said “DMF is a very special fund” as it was “created to benefit a specific section of people – the mining-affected communities” and because “it is not tied to any specific scheme or specific area of work.”

“The fund does not lapse at the end of a financial year, like many other funds. It keeps accumulating in the DMF Trust account. These provisions give a huge scope to plan its use for more than what other schemes provide for, improve and expand upon what already exists and innovate beyond that as well,” Shalya told Mongabay-India.

In India, the share of the mining and quarrying sector is less than two percent of the country’s gross domestic product right now but the government aims to at least double by 2023. Without effective transition policies, ambition could negatively impact the communities living in and around mining-affected areas.

In many mining areas across the country, the lives of the affected communities and biodiversity including forest and water bodies have undergone a transition for the worse. People are facing pollution of their natural resources and their agriculture yield has been impacted. The development that was promised to them in lieu of minerals being extracted from their land has not reached them.

The governments have realised that the transition of mining areas has not been ‘just’ for many people. In December 2020, while speaking at a function of the Confederation of the Indian Industry, Chairman and Managing Director of Coal India Limited Pramod Agrawal said that in order to help grow the mining activity, it needs to be sustainable through reducing air, water pollution and reducing the carbon footprint.

Funds under the DMFs were meant to bring a positive transition in the lives of such communities but the programme seems to be derailing.

The use, misuse and abuse of the DMFs
The years gone by are in fact a witness of many stories of DMF’s use, misuse and abuse.

For instance, Rajesh Tripathi of Chhattisgarh-based Jan Chetna Manch, a social group working for the mining-affected people, said over Rs. 250 crore (Rs. 2.5 billion) were collected for Raigarh district under the DMF-related provision but there is no transparency on how it was used.

“According to DMF rules, the funds collected were to be used for the benefit of mining-affected people but a major portion of this fund has been used in other areas of the district which have nothing to do with mining. It happened because the bodies that are tasked with use of this fund are headed by a legislator of that area,” Tripathi told Mongabay-India.

He said these bodies driving the use of DMF funds are led and controlled by politicians and district administration with zero participation of the locals who have no idea about this fund. “There is absolutely zero transparency and accountability. When we sensitise villagers about it we realise that no work has been done by the government to spread awareness about this fund among villagers,” Tripathi said.

He emphasises that the DMF implementation mechanism talked about provision of conducting a social audit of the works granted under it. “In Raigarh, about 950 projects were sanctioned and of that, about 450 have been completed but their social audit has not yet been conducted,” said Tripathi.

Chinmayi Shalya said, “Currently, most of the DMF use across mining districts in the country shows that the fund is used mostly for physical infrastructure for which other departmental funds are available.”

“This shows a lack of planning or even a basic need-assessment at the district level for optimal and effective use of DMF funds. There is a glaring lack of attention towards improving the well-being of mining-communities through better investments in healthcare, nutrition, availability of clean water and creating income security,” she said.

Shalya cited a recent example of Madhya Pradesh’s Singrauli district, one of the biggest and most polluted coal mining and thermal power hubs in the country, where a part of DMF funds was used for the construction of an air-strip.

“This is brazen misuse of a fund meant for communities which have been bearing the brunt of not only poor amenities and facilities, but also saddled for generations with effects of air, water and soil pollution,” she said.

However, there are some good examples as well that shows how the fund can be used constructively.

“For instance, Keonjhar and Sundargarh districts in Odisha have used DMF funds for local livelihoods through millets … they are using the produce to add millet-based foods in the ICDS (Integrated Child Development Services) scheme for better dietary diversity and nutrition. Bijapur and Dantewada districts in Chhattisgarh set up IPHS (Indian Public Health Standards) compliant hospitals with full staff and doctors through the DMFs,” she noted.

In fact, in August-September 2020, the central government proposed mining reforms that talked about the use of the DMF fund for creating tangible assets in mining-affected areas – something that experts criticised stating that this will be misused and the mining-affected communities will be deprived of this money.

Poor participation of mining-affected communities
One of the main reasons highlighted by experts in the proper use of the DMFs funds is that the money spent is being decided by bodies packed by bureaucrats with negligible participation of local communities.

Amarendra Das of the School of Humanities and Social Sciences at the Indian government’s National Institute of Science Education and Research (NISER), explained that the issues with DMF are multifaceted. “The money under the DMF was supposed to be used by the local bodies in villages and districts in accordance with their needs. But the process is hampered by bureaucracy, who instead of allowing the usage of funds in a decentralised manner, is pushing big projects on block and district level.”

“For example, rather than every village having their own drinking water system or local interventions that generate local employment and involve local decision making, the officials are calling for mega drinking water projects which get stuck on one level or another, decided without the involvement of villagers and devoid the locals of work and earning opportunities. Many times such projects get stuck and remain incomplete,” Das told Mongabay-India.

“There is a clear problem of mismanagement as a result of which, the mining-affected communities don’t get the benefit of the fund that was collected after taking away their resources,” he said.

DMF funds may not be reaching mining-affected communities
Of the Rs. 416 billion collected under the DMFs (till September 2020), about Rs. 177.66 billion have been spent. But experts note that the money is not being spent in conformity with the idea it was created for.

iForest’s Srestha Banerjee remarked that the “DMFs are operating with little knowledge of people who are the beneficiaries, even as data related to the funds under it etc was supposed to be shared with the public at large.”

“So far, most of the states and districts have failed to optimize the opportunity to address the injustice with the mining-affected communities. DMF is being treated as any other development or infrastructure fund while it is far beyond that. The spirit of DMF is natural resource benefit sharing. ” she said.

Chinmayi Shalya said for DMFs to function effectively, the decision making “needs to involve mining-affected people, the directly affected areas and affected people need to be clearly identified and notified.”

“A long-term planning exercise needs to be mandated so that funds are used wisely and no duplication with other schemes happens. Districts must be equipped with resources and expertise to plan effectively and improve upon and go beyond the existing public welfare schemes. Awareness and capacity of local communities should be built to partake in decisions and monitor the works under DMF,” she said.

She stressed that for the DMF mechanism to succeed, districts must focus on the delivery of services rather than a spree of creating only infrastructure, engage local partners for implementation. Livelihoods, with a focus on natural resources like forests, agriculture etc, as they will be key in improving local economy and incomes.

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