Odisha Sun Times Bureau:
Bhubaneswar, Jan 14:
A day after President Pranab Mukherjee gave his assent to mines ordinance that paves the way for auctioning of mines, Odisha’s ruling Biju Janata Dal (BJD) on Tuesday opposed the Centre’s move saying it is contrary to the spirit of federalism to rush through such an ordinance without consulting the states likely to be affected by it.
‘‘The Union government’s promulgation of an ordinance in haste is an impediment to the federal system. There is a need to make amendments to certain provisions of the Mines and Minerals (Development and Regulation) Act, 1957. A draft legislation was circulated to all mineral bearing states including Odisha and they have submitted their proposals before the government. At a time when the Centre is talking about strengthening the federal structure, it is unfortunate that the government has not taken the states into confidence and went ahead with the ordinance. A few days ago, a coal ordinance was introduced and now the mines ordinance. I don’t understand the urgency to bring such ordinance in hurry?’’BJD spokesperson Amar Satpathy questioned while participating in a discussion on the issue on a local news channel.
Notably, the state government had earlier raised its demand to levy cess or tax other than mining royalty. Besides, it had demanded greater say in granting license to the mines holders.
Senior BJP leader Manmohan Samal, however, batted for the ordinance and dared the BJD to come up with specific ibjections.
‘‘Till recently, there was no clarity in the MMDR Act as a result of which the development of these mineral-rich states was hampered. With the promulgation of ordinance, much clarity on the Act has come. Several industries were lying defunct due to delay in lease renewal and subsequent renewals have also been affected by court judgements. As a result, the output in the mining sector has come down drastically. Now, transparency will prevail and industries will function smoothly,’’ he said.
According to a government gazette published on January 12, the Ordinance provides for granting mines for 50 years through a competitive bidding route, including e-auction. The Cabinet, chaired by Prime Minister Narendra Modi, had approved the ordinance on January 5.
‘‘In the MMDR Act there is provision for auction. For instance, when you are auctioning a house property or a piece of land, you know what the property is exactly. But in case of mineral property, one cannot ascertain the amount of reserve and quality from the surface. So, additional provisional could have been accommodated if government would have set aside some royalty,’’ former Director of Mining and Geology B K Mohanty said.
The Ordinance empowers the Centre to prescribe terms and conditions and procedure for bidding which include production sharing or royalty payment or a combination of both. The Mines Ministry said it would ensure greater transparency and also an increased share for states from the sector.
Unlike in the 1957 Act, there would be no renewal of any mining concession. The tenure of mineral concession has also been increased from existing 30 years to 50 years. Thereafter, the mining lease would be put up for auction.
The mines, which are already granted before the ordinance, would also be deemed to have been given for a period of 50 years.
“Ordinance provides that mining leases would be deemed to be extended from the date of their last renewal to March 31, 2030 (in the captive miners) and till March 31, 2020 (for the merchant miners) or till the completion of the renewal already granted, if any, whichever is later.
Thus, no mining lease holder is likely to be put into any disadvantaged condition. It is expected that this would immediately permit such closed mines to start their operations,” the Mines Ministry said in the gazette.
The holder of a mining lease or a prospecting licence-cum -mining lease would have to pay to District Mineral Foundation in addition to the royalty, but not exceeding one-third of such royalty.
Also there is a provision for setting up National Mineral Exploration Trust and the holder of the lease or a prospecting licence-cum-mining lease would pay 2 per cent of the royalty.
“The object of the Trust shall be to use the funds accrued to the Trust for the purposes of regional and detailed exploration …,” it said.
Violators would be punished with fines of up to Rs 5 lakh per hectare of the area and imprisonment for up to five years. Further, a provision has been made for constitution of special courts by the state government for fast-track trial of cases related to illegal mining.