Orissa wants a 20 per cent royalty on coal, on the value of the commodity, up from 8 per cent. It has asked the Centre to approve this increase.

“We want the royalty rate to be increased to 20 per cent ad valorem,” the Orissa Chief Minister, Mr Naveen Patnaik, told reporters after meeting the Coal Minister, Mr Sriprakash Jaiswal, to discuss the issue of coal linkages to the State.

Mr Patnaik urged Mr Jaiswal to speed up Central clearances for the coal blocks allocated to the State.

Though royalty rates are fixed by the Centre, the States, which own the minerals, are the main beneficiaries of the accruals. At present, States charge a royalty of 8 per cent to 13 per cent for coal, depending on the grades. The price of coal is fixed by Coal India Ltd in consultation with the Coal Ministry.

Posco project

Replying to a query on the Posco project, Mr Patnaik exuded confidence that the South Korean firm's $52-billion steel project would soon get a nod from the Environment Ministry to clear forest areas. About 2,900 acres of the 4,000 acres required for the Posco project fall in forest areas.

The Environment Ministry, while according conditional clearance to Posco's 12 million tonne per annum project in January, had sought a pointed assurance from the State on the proper implementation of the provisions under the Forest Right Areas (FRA).

The Orissa Government is in the process of preparing the assurance report for proper implementation of FRA.

“We will be submitting the report shortly and I anticipate the Posco project to certainly come through. It is the biggest foreign investment in the country,” Mr Patnaik said.

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