The Hindu Business Line : States to continue to have rights over mineral concessions

New Delhi, Dec. 23 It’s not the best of times for big mining companies. While both domestic and global players are waiting for the proposed amendment in the Minerals and Metals (Development & Regulation) Act 1957 to end delays in receiving mineral concessions from State Governments, they may not be lucky.

The provision that allows the Centre to intervene in disposing of a company’s application for mineral concessions in case the State does not take a decision in the prescribed time limit is being done away with.

This provision was one of the reform recommendations made by the high-level committee set up under Planning Commission member Mr Anwarul Hoda for the mining sector with the objective to woo big investments.

Officials in the Ministry of Mines told Business Line that “the Government has not agreed to the Hoda Committee recommendation on this issue”.

Strong opposition

“Constitutionally, State Governments are the owners of all mineral resources in their region. Mineral-rich States had opposed the proposal and the Centre has agreed with them,” officials said.

Chief Ministers of Orissa, Jharkhand, Chhattisgarh, Madhya Pradesh and Rajasthan in December 2007 had submitted a joint memorandum to the Prime Minister opposing the power given to the Centre in the draft National Mineral Policy (NMP).

The five chief ministers in their memorandum had pointed out that a major concern of the draft NMP was to attract foreign direct investments in the mining sector for large-scale prospecting, and access to improved technology in mining. This concern has generated the concepts of stand-alone mining activities, security of tenure along with transparency in the allocation of concessions, seamless transition from prospecting to mining, and an export policy favouring long-term export of minerals, the memorandum said.

“This approach is fundamentally flawed in so far as bulk minerals like iron ore, bauxite, chromite, limestone, dolomite and manganese are concerned,” the chief ministers had pointed out.

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