Friday 17 October 2014

Odisha: Miners to get respite as panel unlikely to recommend complete ban on mining activities


By MEERA MOHANTY, ET Bureau | 17 Oct, 2014
BHUBANESWAR: Odisha's miners may be spared the fate of their counterparts in Goa and Karnataka who had been asked to shut operations by the Supreme Court over illegal mining.

A panel appointed by the top court to study mining activities in the state is giving final touches to its report to be submitted Friday, and an absolute ban is unlikely to be part of its recommendations to set things right. That will bring relief to the state and steelmakers who have been forced to import iron ore.

The Central Empowered Committee (CEC) is also unlikely to defend the state's claim of Rs 60,000 crore from miners for excess mining, said a person in the know. Instead, a one-time levy, on account of environmental damage caused by excess mining, could be charged that industry insiders estimate could add up to Rs 5000-7000 crore for all of the state's miners. A substantial amount would also be levied on them for mining in forest areas where the activity isn't permitted. A final decision will lay.

Odisha and the state's industry hope the report to reiterate their vociferous claim that there has been no rampant "illegality" in Odisha, though there may have been widespread "violations" of rules.

"The CEC could demand a compensation towards environmental damage from excess mining, but not the entire value as has been claimed by the Shah Commission," said a businessman whose mines have been lying idle for want of clearances.

Naveen Patnaik's government in November 2012 had sought thousands of crores back from iron and mangnese ore lessees, including Adity Birla Group's Essel Mining and JSPL's Sarda mines and well as steelmakers like Tata Steel and Steel Authority of India, for every tonne produced above their environmental and forest permits, cap set by the pollution control board or what was approved under their mining plan. The near Rs 60,000 crore plus claim, which came to define the "mining scam" in Odisha, was reiterated by a fact finding commission headed MB Shah, a former judge, which was appointed by the previous Congress-led Central government. It equated violation of environmental and forest laws at par with violations of the Mines and Minerals Development and Regulation Act, and invoking section 21(5) of the act, it asked for state governments, both in Goa and Odisha, to seek the entire value of "illegally" produced ore back from miners.

The CEC is likely to disagree that this section can apply to violations of Environment Protection Act, 1986 and the Forest Conservation Act 1980. As it has hinted in the past, including during discussion with Odisha's miners in June, it could instead levy a per tonne charge of 20-30% on the average price that the Indian Bureau of Mines have for equivalent grade ore.

A substantial claim could be due on Tata Steel, SAIL and the state's own Orissa Mining Corporation and other who argue that the MoEF delayed clearances. SAIL did not respond to emails seeking comment, while Tata Steel could not be reached for comment.

The CEC had set a 20% encroachment outside of boundary as a cut off to justify cancellation of leases in Karnataka, where mines tend to be smaller though. "GPRS surveys indicate encroachments have been minor in the state (Odisha), the worst being about 9% of total area," said a senior official of the department of steel and mines.

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