By Our Correspondent
BHUBANESWAR: Odisha Chief Minister Naveen Patnaik has appreciated the reforms made in mineral sector by Union Cabinet led by PM Shri Narendra Modi. It will pave way for large private investments in future & ensure transparency in mineral sector in the country.
“Appreciate the reforms made in mineral sector by Union Cabinet led by PM Shri Narendra Modi. It will pave way for large private investments in future & ensure transparency in mineral sector in the country. Pralhad Joshi,” Naveen Patnaik tweeted@Naveen_Odisha.
India on Wednesday liberalised the mineral sector paving way for large private investments through auction of nearly 500 leases, doubling production in the next 4-5 years, sources said.
The amendments, now to be laid before Parliament in the Budget session, do away with distinction between captive and non-captive mines, allowing transfer of mining leases.
Comprehensive license for exploration and production, clarity in illegal mining, national mineral index and joint auctions of bauxite and coal mines for aluminium sector are some of the other proposals that have been approved by the Cabinet.The Union Cabinet chaired by Prime Minister Narendra Modi approved structural reforms in the mining sector through legislative amendments to the MMDR Act, 1957, the sources said.
The Ministry proposed the removal of section 10A (2b) and 10A (2c) under the MMDR act which hindered the prospect of a mineral auction of over 500 mines. The MMDR Act clause 10A (2c) allowed pre-auction mines to get EC & FC clearances by 2017 and clause 10A (2b) does not have a sunset clause on pre-auction mines for starting operations.
The proposal includes the removal of the distinction between captive and non-captive mines, an incentive for early mineral production for miners by way of 50 percent rebate on revenue share for the quantity produced earlier than the schedule. Provision of penalty is also proposed for not maintaining prescribed production for 3 consecutive quarters, which may lead to termination of mining lease.The Mines Ministry is also streamlining provision for additional royalty on an extension of mining leases under section 8A of the MMDR act and rules.
The amendment to the section will allow states to charge additional royalty in lieu of mining lease extension. This comes at the back of NMDC’s Donamalai mine’s lease expiry in Karnataka that led to the long disruption of iron ore mining. This move will ensure there is no such disruption in mineral production future and also bring a level playing field for auctioned and government dispensation allotment of mines to PSUs.
The ministry also plans to reallocate mineral mines of Public Sector Undertakings (PSUs) if it fails to bring the mines online in 5 years. The government also plans to develop the National Mineral Index for the purpose of statutory and auction payments as the Average Sale Price is considered distorted due to various reasons. The changes to the rules and act of MMDR will be laid in the parliament for amendment before it is made public by the government and it is expected in the upcoming budget session.
