Mineral-rich tribal distts to get more govt fund

Mineral rich tribal districts of India would to get additional Rs 10,000 crore every year for development with a Group of Ministers deciding a new model of revenue sharing from minerals in the proposed mines and mineral (development and regulation) bill, 2011.

Updated on: Jul 8, 2011, 01:46:55 IST

Hindustan Times | By Chetan Chauhan, New Delhi

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Mineral rich tribal districts of India would to get additional Rs 10,000 crore every year for development with a Group of Ministers deciding a new model of revenue sharing from minerals in the proposed mines and mineral (development and regulation) bill, 2011.

A GoM headed by finance minister Pranab Mukerjee on Thursday decided that 26 % of profit from coal sector and amount equal to the royalty paid for non-coal minerals will have to be shared with district mineral foundation, mandated to carry out development works for locals affected by mining activity.

The GoM rejected the mines ministry proposal of sharing 26 % of the royalty with the district mineral foundation as it would have undermined the Government’s commitment to provide more resources for betterment of tribals.

Mines ministry proposal: Charge 26% of royalty from mines for development of locals

GOM decision:

26% profit revenue in coal sector.

Amount equal to royalty paid in non-coal minerals.

The money will be deposited with District Mineral Foundation.

The foundation will use the funds for development for locals displaced by mining.

“It is a progressive decision with an aim to provide additional resources to fasten development in forest and tribal rich mineral districts of India,” environment minister Jairam Ramesh, a GoM member, told HT.

India’s top 50 mineral rich districts also have majority tribal population and best quality forests.

The GoM decided for the twin formula to maximize money from the mineral sector for development. Profit sharing for coal was decided as public sector Coal India Limited extracts 90 % of the coal in India. In case of non-coal minerals, the GoM felt that evaluating profits from each mine of a private company will be difficult and some members also raised the issue of companies fudging their profit figures to evade sharing. “Royalty is pre-determined and fixed,” a GoM member said.

The decision will mean Coal India Limited, India biggest coal producing company, will have to pay Rs 2,500 crore every year to the foundation. Other public sector mining companies will have to pay anything between Rs 45 to 100 crore every year. In all, the GoM expects to get Rs 10,000 crore every year after the bill, to be introduced in monsoon session, gets Parliament approval.

Under the existing regime, there was no revenue sharing for development of locals. But former mines minister B K Handique sought revamp of the old law to introduce revenue sharing for benefit of locals. The industry bodies and planning commission deputy chairperson Montek Singh Ahluwalia objected to profit sharing formula claiming that it will make the mining business economically unsustainable.

The GoM overruled the objections and agreed to a middle path. “It is for the first time revenue sharing has been introduced for industry,” a GoM member said. A similar provision of sharing revenue for welfare of locals in the proposed Companies Law was deleted.

ABOUT THE AUTHOR
Chetan Chauhan
Chetan Chauhan is the National Affairs Editor looking into all aspects of news and features from across India. A Chevening scholar with over three decades of experience in reporting and news management, Chetan has extensively covered all important aspects of the social sector, political economy, environment and climate change nationally and internationally. He did a journalism course at the Reuters Institute of Journalism in Oxford and Digital Media training at Nanyang Technological University in Singapore. He started as a reporter with The Statesman in 1996 and joined the Hindustan Times in 2000 in the metro bureau covering environment, crime and Delhi politics. He covered hot local news, from the Jessica Lal murder case to the rebellion of Delhi Congress MLAs against then Chief Minister Sheila Dikshit, to the replacement of toxic vehicle fuel with cleaner compressed natural gas (CNG) in the national capital. Some of his stories on air pollution became part of the Supreme Court’s landmark MC Mehta versus Government of India case in the National Capital Region (NCR), forcing the government to take corrective measures. As part of the national political bureau since 2004, he covered important central sectors such as environment, education, social justice, labour, rural development, water resources, renewable energy, agriculture, broadcasting and the Planning Commission for more than a decade producing several exclusive and investigative breaking stories. His specialisation is the environment, having covered at least a dozen United Nations global conferences on climate change, biodiversity and wildlife including climate summits in Paris, Copenhagen and Bali. He also covered India’s two five-year plans ---11th and 12th and reported on drafting and execution of right based laws such as Right to Education, Right to Information and rural job guarantee law, MG-NREGA, now being introduced in new format as VG-RAM-G Act. He has in-depth knowledge of social sector issues. He was one of the first to report on tigers vanishing from Sariska and Panna wildlife reserves in 2004 and 2008, respectively, leading to the setting up of the National Tiger Conservation Authority (NTCA) and the introduction of stringent penal provisions for poaching. He has written extensively on the rising human-animal conflict in India and the degradation of India’s biodiversity hotspots because of mining and other activities. Since 2004, Chetan has covered Parliament comprehensively and participated in training on the nuanced coverage of Parliament proceedings. He has travelled extensively across India to cover national and provincial elections since 1998, especially in the Hindi heartland states, considered India’s road to power. He writes a regular column for Hindustan Times, Ecostani, on important national politics, economy, Himalayan ecology and environmental issues. His other responsibilities include providing inputs for edits and edit page articles for the publication, apart from managing news flow from across India.Read More

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