New life to the mining sector

The Sanghai Express | April 11, 2021
Pralhad Joshi
Contd from prev issue
This Amendment Act is set to redefine the standard of exploration required for auctioning partially explored mineral blocks for Prospecting License-cum-Mining Lease. This will boost the seamless transition from exploration to production and encourage participation of private players. The amended provisions in the Act also ensure better clarity on ‘Mining without Lawful Authority’ to save leaseholders from unjustified penalties under other litigations.

We have also fulfilled a long-standing demand by making local Members of Parliament a member of District Mineral Foundation (DMF) Governing Council to make DMF more outcome-oriented. Arrangements have also been made to keep a check on misuse of DMF funds so that inclusive development of those affected by mining can be ensured.

There are several other changes in the MMDR Act that will boost ease of doing business in the mineral mining sector and make it more competitive and productive. The MMDR Amendment Act, 2021 will pave the way for the creation of almost 55 lakh employment opportunities along with having a multiplier effect on several other sectors. Prime Minister Modi has ensured that the mineral mining sector gets to play its actual role of being the foundation of the nation’s economy. Over several meetings, he has laid out an envisioned plan wherein the sector is taking allied industries on a growth course to becoming a $5 trillion economy. I am happy that these amendments are in line with his vision and confident that the sector has a major role to play in defining us as a New India. PIB The author is Union Minister of Coal, Mines & Parliamentary Affairs

APMDC has no right to issue tender for calcite mining in scheduled area: EAS Sarma

The Hindu | April 09, 2021

‘It should be first discussed in the local adivasi Gram Sabha’
Former secretary to GOI and former Commissioner for Tribal Welfare, A.P. Government, E.A.S. Sarma, has taken strong exception to the way in which the AP Mineral Development Corporation (APMDC) has issued an E-Tender for ‘Working of Calcite Mining Lease’ of 8.725 hectares at Nimmalapadu village in Ananthagiri mandal in Visakhapatnam district, on ‘Raising-cum-sale contract basis’.

In a letter to the Chief Secretary, he stated that the APMDC has no right to unilaterally issue such a notification and it was in gross violation of the provisions embedded in the Panchayat (Extension to the Scheduled Areas) Act (PESA) and the Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act (FRA).

Speaking to The Hindu, he said that both the Acts are applicable to the Nimmalapadu village, as it lies within the notified Scheduled Area of Visakhapatnam district.

According to him, in the Scheduled Areas, as per the provisions of PESA, the question whether any mineral should be extracted and, if so, by whom, should be discussed first by the local adivasi Gram Sabha.

Such a prior discussion had not apparently taken place, he alleged. Even under the FRA, it is necessary that the individual and community rights to the land and the forest resources should be subject to prior discussion by the local adivasi Gram Sabha, which appears to have been bypassed, he added.

As such, the e-tender notice is patently illegal and liable to be set aside, he said.

The Samata Judgement and the judgement in the case of bauxite mining by Vedanta in the scheduled area of Odisha, holds good in this case also, said Mr. Sarma.

It is learnt that a local tribal cooperative has approached the AP High Court to obtain a stay on the e-tender.

A few years ago, the same tribal cooperative had approached the government for lease for mining and was denied.

In new India, leveraging the country’s great mineral potential

Hindustan Times | Pralhad Joshi | April 07, 2021

Given the importance of the sector, the Narendra Modi government has envisioned increasing the sector’s contribution from 1.75% of the Gross Domestic Product (GDP) currently to 2.5% of GDP

Among the most important sectors with an impact on economic growth is mineral mining. In terms of generating employment, the sector, second only to agriculture, directly and indirectly employs about 11 million people, and sustains the livelihood of about 55 million people.

Despite its huge potential, India’s mineral mining sector remained choked under previous regimes. India had been underexplored — over 17% of the nation’s land area has mineral reserves whereas mining is being carried out only on 0.25% of the area. The sector had also underperformed in attracting investments. While mineral production stands at ₹1.25 lakh crore annually, its import is a whopping ₹2.5 lakh crore.

But given the importance of the sector, the Narendra Modi government has envisioned increasing the sector’s contribution from 1.75% of the Gross Domestic Product (GDP) currently to 2.5% of GDP. My ministry’s most important task, therefore, has been reforming this sector, with the aim of increasing the mineral production output by 200% over the next seven years. The Mines and Minerals (Development and Regulation) Amendment Act, 2021 is a step towards achieving this.

Despite its huge potential, India’s mineral mining sector remained choked under previous regimes. India had been underexplored — over 17% of the nation’s land area has mineral reserves whereas mining is being carried out only on 0.25% of the area. The sector had also underperformed in attracting investments. While mineral production stands at ₹1.25 lakh crore annually, its import is a whopping ₹2.5 lakh crore.

But given the importance of the sector, the Narendra Modi government has envisioned increasing the sector’s contribution from 1.75% of the Gross Domestic Product (GDP) currently to 2.5% of GDP. My ministry’s most important task, therefore, has been reforming this sector, with the aim of increasing the mineral production output by 200% over the next seven years. The Mines and Minerals (Development and Regulation) Amendment Act, 2021 is a step towards achieving this.

A large number of mining blocks were not brought into production for many years. Most have been blocked in legacy cases. Such cases can neither be granted lease because the time period to grant them is already over, nor can they be brought to auction because of the legal impasse. We have amended the existing provision for reallocation of such mineral blocks through a transparent auction mechanism. Auctioned mines not made operational within three years will be returned to states concerned for reallocation through auction, as will greenfield mines allocated to public sector units that are not brought into production after a review.

One of the key reforms is transferring all valid rights, approvals, clearances and licenses to the new lessee, valid until the mineral reserves last. This would facilitate lessees to transfer the mine to another entity, thus bringing in fresh investment and entrepreneurship to operate the mine.

Since 2015, geological reports for 143 mineral blocks have been handed over to various states. These blocks are auction-ready, but so far, states have only auctioned seven blocks. To ensure that national reserves are put to best use, a provision has been made wherein the Union government can conduct auctions in consultation where states face challenges or fail to conduct auctions.

Removing the distinction between captive and non-captive mines was long in coming. We knew it was akin to participating in a race with one leg tied. With no such distinction now, there will be a level-playing field for mineral block auctions. Existing captive mines have also been allowed to sell minerals over and above their requirements. A 50% rebate in the revenue share, for the quantity of minerals produced and dispatched earlier than scheduled date of production, has also been provided.

This amendment Act is set to redefine the standard of exploration required for auctioning of partially explored mineral blocks for prospecting licence-cum-mining lease. This will boost seamless transition from exploration to production and encourage the participation of private players. The amended provisions in the Act also ensure better clarity on “Mining without Lawful Authority” to save lease-holders from unjustified penalties under other litigations.

We have also fulfilled a long-standing demand by making local Members of Parliament members of the District Mineral Foundation (DMF) governing council to make DMF more outcome-oriented. Arrangements have also been made to keep a check on misuse of DMF funds so that inclusive development of those affected by mining can be ensured. There are several other changes in the MMDR Act that will boost the ease of doing business in the mineral mining sector, make it more competitive, pave the way for creation of employment opportunities, and have a multiplier effect on several other sectors. Over several meetings, PM Modi laid out a plan where the sector takes allied industries on a growth course to help India become a $5-trillion economy. These amendments are in line with his vision, and the sector will play a major role in defining a New India.

New life to the mining sector

Financial Express | Pralhad Joshi | 06-04-2021

This Amendment Act is set to redefine the standard of exploration required for auctioning partially explored mineral blocks for Prospecting License-cum-Mining Lease. This will boost the seamless transition from exploration to production and encourage participation of private players. The amended provisions in the Act also ensure better clarity on ‘Mining without Lawful Authority’ to save leaseholders from unjustified penalties under other litigations.

We have also fulfilled a long-standing demand by making local Members of Parliament a member of District Mineral Foundation (DMF) Governing Council to make DMF more outcome-oriented. Arrangements have also been made to keep a check on misuse of DMF funds so that inclusive development of those affected by mining can be ensured.
There are several other changes in the MMDR Act that will boost ease of doing business in the mineral mining sector and make it more competitive and productive. The MMDR Amendment Act, 2021 will pave the way for the creation of almost 55 lakh employment opportunities along with having a multiplier effect on several other sectors. Prime Minister Modi has ensured that the mineral mining sector gets to play its actual role of being the foundation of the nation’s economy. Over several meetings, he has laid out an envisioned plan wherein the sector is taking allied industries on a growth course to becoming a $5 trillion economy. I am happy that these amendments are in line with his vision and confident that the sector has a major role to play in defining us as a New India. PIB The author is Union Minister of Coal, Mines & Parliamentary Affairs

MMDR reforms to give new LIFE to the mining sector

The MMDR reforms will give new ‘LIFE’ to the mining sector, where ‘L’ stands for Long-term impact, ‘I’ for Immediate boost to mineral production, ‘F’ for Focus on public welfare, and ‘E’ for Ease of Doing Business

Building a post-Covid-19 world requires grit, perseverance and a vision—precisely everything that makes up Prime Minister Narendra Modi. The world was taken aback with the pandemic and was struggling to deal with it when our Prime Minister announced the grand vision of a self-reliant India, the AatmaNirbhar Bharat. As the Union Minister of Mines and Coal, I often reflect upon my ministry’s contribution to this grand initiative. We were collecting daily reports down to each district and having detailed deliberations with none other than the Prime Minister himself.

Therefore, when during the launch of auction for commercial mining of coal, on June 18, 2020, PM Modi talked about ending decades of lockdown in coal, the sector was only too ready to don the new avatar. In the ensuing months, the government galvanised its machinery to remodel the mineral mining sector.

The mining sector is next only to agriculture in terms of generating employment. The sector directly and indirectly employs about 1.1 crore people and sustains the livelihood of about 5.5 crore people in the country. One direct job in the sector creates 10 indirect jobs. Similarly, 1% growth in mining results in a 1.5% growth in industrial production. Its importance grows manifold when we consider other allied sectors that depend on it for their survival and existence. Sectors such as steel, aluminium, commercial vehicles, rail transportation, ports, shipping, power generation, etc, are closely linked to the mining sector. Therefore, a boost to the mining sector will boost these sectors as well, which, together, will brighten the economic horizon of the nation. With a sector having such far-reaching significance in generation of employment opportunities, the Modi government envisions increasing its contribution from 1.75% of GDP currently to 2.5% of GDP, with an aim to increase the mineral production output by 200% in the next seven years.

The country’s mineral mining sector has remained choked for several decades under previous regimes. Despite huge mineral potential, India had so far been underexplored with mining being carried out only on 0.25% of the land, whereas over 17% of the national land has mineral reserves. The sector had also underperformed in attracting investments. While mineral production stands at Rs 1.25 lakh crore annually, its import is a whopping Rs 2.5 lakh crore.

Unless one is an ostrich with the head buried under the sand, it does not take much to gauge the herculean task the country has achieved in the last 10 months to give a new direction to economic growth. Mineral mining is one such sector that has witnessed an array of reforms, with the Mines and Minerals (Development and Regulation) Amendment Act, 2021, being the latest addition to the fore. These reforms will give new ‘LIFE’ to the mining sector, where ‘L’ stands for Long-term impact, ‘I’ for Immediate boost to mineral production, ‘F’ for Focus on public welfare, and ‘E’ for Ease of Doing Business.

We have seen how a large number of mining blocks with very high quality of resources were not brought into production for many years, resulting in suboptimal utilisation of valuable national mineral resources. Most of them have been blocked in legacy cases. Legacy issues pertaining to mining have become an impediment as such cases can neither be granted lease because the time period to grant them is already over, nor can they be brought to auction because of legal impasse. We have amended the existing provision for reallocation of such mineral blocks through a transparent auction mechanism. Similarly, auctioned mines not made operational within three years will be returned to the concerned states for reallocation through auction and Greenfield mines allocated to PSUs that are not brought into production are also proposed to be reviewed and given back to state governments for auction. Bringing unused mineral blocks into production will generate enormous employment opportunities and bring growth to such mining areas.

One of the key reforms is transferring all valid rights, approvals, clearances and licences to the new lessee, valid until the mineral reserves last. This would facilitate lessees transfer mine to another entity, thus bringing fresh investment and entrepreneurship to operate the mine.

Since 2015, geological reports for 143 mineral blocks have been handed over to various states. These blocks are auction-ready, but so far only seven blocks could be auctioned by states. To ensure that national reserves are put to best use for the development of the nation, provision has been made wherein the central government can conduct auctions in consultation where state governments face challenges or fail to conduct auctions.

Removing the distinction between captive and non-captive mines was long-coming. We knew it was akin to participating in a race with one leg tied down. With no such distinction now, there will be level-playing for mineral block auctions. Moreover, existing captive mines have also been allowed to sell mineral over and above their requirements, and 50% rebate in the revenue share, for the quantity of mineral produced and dispatched earlier than the scheduled date of production, has been provided.

This amendment Act is set to redefine the standard of exploration required for auctioning of partially explored mineral blocks for prospecting licence-cum-mining lease. This will boost seamless transition from exploration to production and encourage participation of private players. The amended provisions in the Act also ensure better clarity on ‘mining without lawful authority’ to save leaseholders from unjustified penalties under other litigations.

We are fulfilling a long-standing demand by making local Members of Parliament a member of the District Mineral Foundation (DMF) Governing Council to make the DMF more outcome-oriented. Arrangements have been made to keep a check on misuse of DMF funds so that inclusive development of those affected by mining can be ensured.

There are several other changes in the MMDR Act that will boost ease of doing business in the mineral mining sector and make it more competitive and productive. The MMDR Amendment Act, 2021, will pave the way for creation of almost 55 lakh employment opportunities along with having a multiplier effect on several other sectors. PM Modi has ensured that the mineral mining sector gets to play its actual role of being the foundation of the nation’s economy. Over several meetings he has laid out an envisioned plan wherein the sector is taking allied industries on a growth course to India becoming a $5-trillion economy. I am happy that these amendments are in line with his vision and I am confident that the sector has a major role to play in defining ourselves as a ‘new India’.

Amid protest, Odisha Cabinet okays mineral foundation fund for hockey stadium

The Hindustan Times | March 25, 2021

District Mineral Foundation fund for an international hockey stadium in Rourkela is just one of the many projects taken up even as environmentalists protest that the money should be used for improving the lot of people directly affected by mining, which was the purpose of this fund

On Monday, the Odisha Cabinet approved the development of Bhubaneswar’s Kalinga Stadium and construction of an international hockey stadium in Rourkela ahead of Men’s Hockey World Cup in 2023. Of the ₹356.38 crore the project requires, ₹266 crore will come through District Mineral Foundation (DMF) Trust of Sundargarh, and Odisha Sports Development Fund.

The decision has renewed the questions that have been raised over the alleged misuse of DMF funds for a various other projects but those for mining-affected public, which was why the DMF was created. For instance, in January last year, Rourkela city police got 25 Innova Crysta vehicles at a cost of ₹4.65 crore with Sundargarh DMF fund.

“How would building stadium or buying police vehicles help mining-affected areas? People in Sundargarh don’t have access to safe drinking water and proper roads. Should the funds not be used for better purposes,” asked Laxman Munda, CPM MLA from Bonai in Sundargarh.

Munda’s protests have come at a time when the Shivraj Singh Chouhan government in Madhya Pradesh is using the DMF funds for the construction of an airstrip in Singrauli district, one of the biggest and most polluted coal mining and thermal power hubs in the country.

DMF was instituted through an amendment to Mines and Minerals(Development and Regulation) Act 2015 to “work for the interest and benefit of people and areas affected by mining”. The funds of DMF trust come from mining companies operating in the respective districts and they pay an equivalent of 30% of the royalty amount for leases granted before 2015, and 10% for leases granted after that. DMF fund is to be spent on improving human development indicators through investments in high-priority areas such as healthcare, education, women and child development, improving sustainable livelihood, and income opportunities in areas adversely affected by mining.

Till January this year, Odisha collected ₹11,984.87 crore in its DMF fund, the highest in the country, and spent ₹5,364 crore out of it, around 44.76% , a little less than the national average.

Yet, there are murmurs of protest over the alleged misuse of funds.

Kusum Tete, BJP MLA of Sundargarh, one of the districts where DMF money is being spent, said, “Rourkela city is not a mining area while most of my electorate bear the brunt of pollution due to coal and iron ore mining. The government is using DMF funds for sports infra in Rourkela, and policing. Should it not have used the money for providing piped water in Sundargarh?”

Tete said Hemagir, one of the blocks in her assembly constituency, suffers from pollution from trucks carrying coal to neighbouring Chhatisgarh. “The first priority should have been using the DMF funds to prevent pollution in the area. The tribals have been agitating for the past two months, but the government is the least bothered,” she said.

Chinmayi Shalya, who works with the International Forum for Environment, Sustainability and Technology (iForest) on DMF issues, said DMF fund is not meant for stadium construction and beautification projects. “It is a targeted fund for mining-affected communities. Using it singularly for hockey World Cup would potentially be a misuse,” she said.

Chief secretary Suresh Mohapatra and Sundargarh district collector Nikhil Pawan Kalyan did not comment on the allegations.

Activists are also severely critical of the state government’s decision to use DMF funds for integrated traffic management system to check road fatalities in the state.

“The commerce and transport department has asked all districts to install CCTV surveillance system for enforcement of traffic violations at vulnerable stretches and black spots on highways from the DMF or Corporate Social Responsibility fund where DMF is not available. How will CCTV surveillance help the lot of tribals?” asked activist Pradip Pradhan.

The state government also plans to construct integrated infrastructure complex, including old age homes in all the 30 districts, with the funding support from DMF. In Keonjhar, locals pointed out the district authorities are building a handball stadium in Keonjhar. “At least 56% of the people in Keonjhar district are Dalits and tribals and sizeable section of them is below the poverty line. Yet the district administration does not take the suggestion of the common people while finalising the plans for DMF use,” alleged Kiran Sahu, president of Keonjhar Citizen’s Forum.

Even as there have been protests over the expenditure on stadiums and police vehicles, the Odisha Commerce and Transport department has sought the permission to build a new railway line project for iron ore transportation in Keonjhar district from DMF fund, triggered another controversy.

In a letter to the Keonjhar district collector, the department has asked if the DMF trust can sanction ₹363.38 crore for building the 18 km Banspani-Barbil line that will provide direct rail connectivity to iron ore loading stations on the Noamundi-Bolani Khadan section from Banspani for movement to steel plants in Odisha or to ports. The railway line is proposed to be built by Odisha Rail Infrastructure Development Limited, a state government-led joint venture with Indian Railways.

Environmentalists and right activists are decidedly against the project. “When DMF fund is supposed to be spent for the benefit of those affected by mining-related operations, seeking permission for spending it on railway project connecting iron ore loading stations to steel plants is a mad idea. The DMF fund is meant to uplift the living standards of mining-affected people, not make their lives more miserable,” said Prafulla Samantara, rights activist who was awarded the Goldman Environmental Prize in 2017.

Prominent environmental activist Biswajit Mohanty said it is laughable to propose spending DMF fund for iron ore transportation when miners are asked to contribute to the fund for the damage they are causing to local environment.

CPM MLA from Bonai constituency of Sundargarh district, Laxman Munda said, “Lack of transparency can result in wasteful expenditure, misuse of funds and sub-standard quality of work and corruption.”

Shalya pointed out that decision-making needs to involve those directly affected by mining. “There are some good investment examples from Odisha, such as, the use of DMF to increase MGNREGA wages at par with state minimum wage in Keonjhar. States should guide and equip districts for a long-term planning of DMFs so that funds are used wisely and effectively to improve the well-being of local communities,” she said.

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