The Centre is reconsidering its decision to make mining firms share 26% of their annual profit with the people displaced by mining projects.
A group of ministers under finance minister Pranab Mukherjee had approved the share ratio in December. The proposal was part of the new Mine and Minerals (Development and Regulation) Bill 2010 prepared by the ministry of mines to replace a 54-year-old law governing mining in the country.
The GoM nod, then — despite objections — was seen as UPA's reach out to the tribals. In August 2010, visiting Niyamgiri in Orissa where the Dongriya Kondhs, a tribal group, protested a mining project, Congress general secretary Rahul Gandhi assured “there is a soldier (for tribals) in New Delhi, to represent their voice.”
The review of the decision now comes after the cabinet reshuffle in January, which saw the mines ministry allocated to Dinsha Patel. The minister, one official said, received renewed representations from the mining industry and also plan panel chief Montek Singh Ahluwalia who pointed out the ‘detrimental effects’ of such largesse on the mining industry.
“As the new minister is not aware of what the proceedings were, it has been decided to discuss the proposals once again,” a ministry official said.
A GoM — including Patel — would be convened soon over the profit-sharing clause among other issues, the official said. The GoM meet comes in wake of Ashok Chawla committee on natural resources which spoke against the profit-sharing model but suggested increase in royalty paid by firms, to address the inclusion question. The bill is likely to be introduced in Parliament’s monsoon session.
“While the argument is profit sharing alone would not address the conflict raging in tribal-mining areas, the government seems to be giving into corporate interests and going back on its decision of profit share with locals,” said Shankar Gopalakrishnan, secretary, Campaign for Survial and Dignity — an NGO working for tribal rights.
The new bill also seeks to do away with prior approval of the Centre for mining projects and puts onus of allocation, licence on the states. However, it does insert a clause where a National Mining Regulatory Authority can override allotments based on conservation, environmental concerns.