Will New Mines Lease Holders retain Old Workers?

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By Correspondent

KOIRA/JODA/RAIRANGPUR: Will New Mines Lease Holders retain Old Workers? This was billion dollar questions that haunts tens of thousands of mining workers working under Joda-Koira-Rairangpur mining circles of Odisha’s mineral rich Keonjhar,Sundargarh and Mayurbhanj districts.Since auction for expired mines has been completed and new lease holders are all set to take over the mines from existing lease holders, mining workers and employees are spending sleepless nights.

Sources said if the new lease holders not entertain old workers,  lakhs of workers both skilled and unskilled working in various mines in would lose their daily earning. Tribals of Keonjhar ,Sundargarh and Mayurbhanj districts primarily depend on mines and mines related transportation for their livelihood.  The locals have deployed their trucks and dumpers in the mines by taking loans from banks.

More than 50 lakh trucks are deployed in mining activities in these 3 districts. Freezing of mines will affect the livelihood of locals both directly and indirectly. A total of 101 mines in Keonjhar and Sundargarh districts have acquired agricultural land. The total agricultural land in both districts is limited to 12,320 hectares only. From this land, 1000 hectares could be irrigated while 3000 hectares have been totally damaged due to adverse effect of mining activities.

There are 4,000-4,500 direct and 5,000-6,000 indirect workers linked to these 8 mines under Koira circle in Sundargarh. The same situation under Joda circle in Keonjhar where 8 mines were auctioned majority of which belongs to KJS Ahluwalia Group. Deputy Director of Mines, Koida LD Nayak said the successful bidders are likely to start operation from April 1.

The Rungta Group’s five mines in Sundargarh were taken up for auction. The rest three include one mine of PK Ahuluwalia and two of AMTC. Sources in Rungta Group said more than 3,000 direct workers of the five mines in KMC have been served three months notice for disengagement.

Trade Union leaders argued that new leaseholder to operate their mines is required to get statutory clearances such as environment and consent to operate under multiple forests and mining Acts. They said that the new leaseholders will take several months to obtain mandatory clearances. As a result, the labourers may lose their jobs till the new leaseholders start mining operations.

Trade Unions demanded that before auctioning the mines, the government should think of rehabilitating the workers related to mining activities. There is no provision for reappointing workers in the mines after auctions.

However, the workers who are working under the existing lease holding companies are worried fearing job losses in case the new leaseholders get rid of them.As the state government has not set particular guidelines to protect the employment of the mineworkers, the workers are jittery.

Trade Union leaders demanded that the government should pay the mining labourers remuneration till the fresh leaseholders start mining activities.

The state will earn about Rs 8,000 crore to Rs 10,000 crore as stamp duty and registration fee alone from mining auction.The revenue share (premium) that a bidder must pay to the Government is cost to him. In addition, the bidder must also pay royalty and the statutory dues like contribution to the district mineral foundation, which is about 17 per cent of the sale revenue. Over and above, the bidder has to pay 18 per cent GST.

As the bids so far have fetched a premium of 95.2 per cent to 141.25 per cent, this shows that every Rs 100 a bidder earns, the cost incurred is much more than the revenue, in some cases as high as 190 per cent of the revenue and this does not include wages, salaries or cost of operation, leave alone the profit margin. If all these are taken into account, the cost will be significantly more than the revenue.

“The Government should ask the successful bidders as to how they will make payment after getting lease at an exorbitant price. The persons or firms who are getting mining leases are not expected to do charity but hardcore business,” said an Industry expert. Mining activities as such have adverse impact on environment. And the leaseholders getting the mines at a high premium may not be able to generate surplus funds to protect the environment.

The Odisha Mining Corporation (OMC), which used to produce 13 Million Ton Per Annum (MTPA), is taking steps to produce 15 MTPA in 2020-21, and in future OMC will be eyeing to produce 50 MTPA. This is a welcome step on the part of the state-owned PSU.However, market demand is much more; and in absence of Merchant Miners as players, situation will aggravate.

Around 599 hectares of forest land have been cleared across Odisha to make way for industries & allied institutions between 2010 and 2019, informed Forest and Environment Minister Bikram Keshari Arukh . During the same period, around 21.27 lakh hectare of land has been afforested, said the Minister.

With Mining Royalty being not hiked over the years, State Government is apprehensive of losing of funds to cater its growing requirement on developmental projects.Officials say Mining Royalty constitutes nearly 25 Percent of Odisha’s Own Revenue and as Royalty is. Odisha Government has approached Government of India to revise rate of royalty of major minerals including iron ore.

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