The Union Minister of Mines and Development of North Eastern Region, BK Handique, unveiled the agenda for 100-day of his both Ministries, prioritizing initiatives which are found to be critical to deliver the results in both the Ministries i.e., Mines and DoNER.
The Minister said that in Mines, the agenda is driven primarily by the National Mineral Policy (NMP) 2008. Both legislative and non-legislative measures to implement this policy would be initiated. Handique informed that a New Act on Scientific Development of Mines and Minerals would be drafted and placed in the Parliament during this Winter Session. In the new Act, the focus will be on scientific and clean mining with innovative technology supported by appropriate Environmental and Social Management Frameworks. This would ensure a climate conducive to private investment and exploration.
“We also embark on revision of royalty rates on ad valorem basis,” he added .
Handique informed that in the first two weeks, the government had decided on some issues as part of this agenda. These are: (a) New Vision and Charter for Geological Survey of India (GSI) in consonance with the requirements of NMP 2008. (b) Guidelines on grant of concessions to give primacy to “seamlessness” and “first-in-time” within the ambit of the existing legislation. (c) GSI was asked to put out all survey and exploration data, maps and reports on its Web Portal free of cost to facilitate private sector participation in mineral exploration; and (d) Capacity building of State DGMs by GSI.
The mining rule—Handique has lot to work for.
Sesa Goa’s acquisition of Dempo group’s mining operations for Rs 1,750 crore, in an-all cash deal, comes as a consequence of the iron ore producing companies accumulating large funds in the boom years. In the case of Sesa Goa, its profit after tax has steadily increased from Rs 99 crore to Rs 1,492 crore over the last five years, even as the boom pushed up the compound annual growth rate of iron ore production to 12.4 per cent during the last decade.
With the global slowdown, the sagging demand for ore is forcing the industry to quickly restructure. Other important minerals where the growth rate soared significantly include bauxite (14.9pc), chromites (14.4pc), zinc (12.8pc), lead (8pc) and dolomite (6.4pc). But growth was relatively more subdued in other equally or more important sectors like coal (5.1pc) natural gas (2.6pc), gold (0.7pc), petroleum (0.5pc) and copper, where the production even declined over the decade. Some attribute this to the overwhelming presence of the government in ownership of these resources.
Perhaps there is a point. The minerals where production has zoomed are those where private sector investments have made significant inroads. For instance, in case of iron ore, where India accounts for just a 7 per cent share of global resources, the growth of production has not only catered to the growing domestic needs, but it has also facilitated a substantial growth in exports which went up to 91 million tonnes in 2006-07, close to half the domestic production.
In contrast, the sectors where mineral production remains slack are mostly those where entry of private sector players has been curtailed due to policy and procedural hurdles. This is especially true of products like coal where the domination of public sector players have caused large demand supply mismatches and pushed up imports to 50 million tonnes, which was a tenth of the domestic output, despite the country possessing almost one third of the global coal reserves. Predictably when the ownership of the resources is with private profiteers their primary aim is to make money as fast as possible.
Thus, all caution of conserving resources for the nation’s use is thrown to the winds. An interesting parallel will be how China did conserve its own resources during the boom phase which was largely triggered by its own fast pace of growth. China did not explore its rich minerals like coking coal but decided to import the same.
While in India apart from the myopic policy the greed of the ruling class saw to wanton sale of such resources abroad. In case of iron ore for example it is reported that the unofficial premium charged for permitting export of ores rich in iron content used to be Rs 100 per tonne.
No wonder the sharp rise in iron ore export is showcased by some as a success instead of an abject shortsightedness of the national economic policy. The blind votaries of free market call for reforms and blame the lacunae in mineral policies and problems connected with acquisition of land for the inability to tap domestic resources. Even the efforts to correct policy in crucial areas like royalty payments to state government have dragged on for too long.
The previous minister Sis Ram Ola, was known less for contributing to the nation’s riches than for certain personal aggrandizement, did wink at the need for policy changes The new minister, BK Handique, has to show improvement in this critical sector.
The Minister said that in Mines, the agenda is driven primarily by the National Mineral Policy (NMP) 2008. Both legislative and non-legislative measures to implement this policy would be initiated. Handique informed that a New Act on Scientific Development of Mines and Minerals would be drafted and placed in the Parliament during this Winter Session. In the new Act, the focus will be on scientific and clean mining with innovative technology supported by appropriate Environmental and Social Management Frameworks. This would ensure a climate conducive to private investment and exploration.
“We also embark on revision of royalty rates on ad valorem basis,” he added .
Handique informed that in the first two weeks, the government had decided on some issues as part of this agenda. These are: (a) New Vision and Charter for Geological Survey of India (GSI) in consonance with the requirements of NMP 2008. (b) Guidelines on grant of concessions to give primacy to “seamlessness” and “first-in-time” within the ambit of the existing legislation. (c) GSI was asked to put out all survey and exploration data, maps and reports on its Web Portal free of cost to facilitate private sector participation in mineral exploration; and (d) Capacity building of State DGMs by GSI.
The mining rule—Handique has lot to work for.
Sesa Goa’s acquisition of Dempo group’s mining operations for Rs 1,750 crore, in an-all cash deal, comes as a consequence of the iron ore producing companies accumulating large funds in the boom years. In the case of Sesa Goa, its profit after tax has steadily increased from Rs 99 crore to Rs 1,492 crore over the last five years, even as the boom pushed up the compound annual growth rate of iron ore production to 12.4 per cent during the last decade.
With the global slowdown, the sagging demand for ore is forcing the industry to quickly restructure. Other important minerals where the growth rate soared significantly include bauxite (14.9pc), chromites (14.4pc), zinc (12.8pc), lead (8pc) and dolomite (6.4pc). But growth was relatively more subdued in other equally or more important sectors like coal (5.1pc) natural gas (2.6pc), gold (0.7pc), petroleum (0.5pc) and copper, where the production even declined over the decade. Some attribute this to the overwhelming presence of the government in ownership of these resources.
Perhaps there is a point. The minerals where production has zoomed are those where private sector investments have made significant inroads. For instance, in case of iron ore, where India accounts for just a 7 per cent share of global resources, the growth of production has not only catered to the growing domestic needs, but it has also facilitated a substantial growth in exports which went up to 91 million tonnes in 2006-07, close to half the domestic production.
In contrast, the sectors where mineral production remains slack are mostly those where entry of private sector players has been curtailed due to policy and procedural hurdles. This is especially true of products like coal where the domination of public sector players have caused large demand supply mismatches and pushed up imports to 50 million tonnes, which was a tenth of the domestic output, despite the country possessing almost one third of the global coal reserves. Predictably when the ownership of the resources is with private profiteers their primary aim is to make money as fast as possible.
Thus, all caution of conserving resources for the nation’s use is thrown to the winds. An interesting parallel will be how China did conserve its own resources during the boom phase which was largely triggered by its own fast pace of growth. China did not explore its rich minerals like coking coal but decided to import the same.
While in India apart from the myopic policy the greed of the ruling class saw to wanton sale of such resources abroad. In case of iron ore for example it is reported that the unofficial premium charged for permitting export of ores rich in iron content used to be Rs 100 per tonne.
No wonder the sharp rise in iron ore export is showcased by some as a success instead of an abject shortsightedness of the national economic policy. The blind votaries of free market call for reforms and blame the lacunae in mineral policies and problems connected with acquisition of land for the inability to tap domestic resources. Even the efforts to correct policy in crucial areas like royalty payments to state government have dragged on for too long.
The previous minister Sis Ram Ola, was known less for contributing to the nation’s riches than for certain personal aggrandizement, did wink at the need for policy changes The new minister, BK Handique, has to show improvement in this critical sector.
Next Story
