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New Mining Policy brings States and Centre face-to-face

HNF Bureau

August 12, 2007

When mining and mineral based industries are in the top of India’s development agenda, Chief Ministers of five mineral rich states – Orissa, Jharkhand, Chhatishgarh, Rajasthan and Karnataka have expressed their dissatisfaction over centre’s reservations on the forth-coming mining policy.

In a meeting with union home minister Sivraj Patil, all five chief ministers demanded that the draft mining policy must be given to the mineral rich states to see and analyse how the state interests are taken care of and demands put by states are kept in view. This is very much essential as the mineral rich states are not getting desired benefits although they contribute a lot for industrialisation and development of the country.

The chief ministers discussed different recommendations of Huda Committee with home minister Sivraj Patil and insisted upon enhancement of royalty on iron ore to 20-25% as State share. All the chief ministers present in the meeting demanded to stop export of iron ore and allow the states to go for value addition projects in their respective states so that the states would derive more benefit and generate adequate employment for the youth. But mines Minister Sisram Ola, who also attended the meeting, rejected the proposal of putting restrictions on export of iron ore.

Other states like left ruled West Bengal government puts pressure on the UPA government to nationalise iron ore in India which will facilitate transport of iron ore to from any place to any part of the country for industrial use. Once this is done, mineral rich states and particularly the states with huge iron ore reserve would loose their control completely over the iron ore reserves. Orissa is more concerned about the policy as it contains maximum iron ore reserves in India.

Interests of mineral rich states should be kept in view while drafting the mining policy because most of such states such as Orissa, Jharkhand and Chhatishgarh fight with problems like poverty and unemployment although it is these states who give India the pride of having huge mineral resources. But unfortunately these states are among the most backward and poverty stricken states of the country. Acute unemployment problem in these states lead to growing internal terrorism like naxal activities which drains a huge amount of revenue from the state exchequer.  On the other hand, large scale opencast mining for the purpose of exporting ores in huge volume do not bring any benefit to the state where as it causes pollution and create a hazardous atmosphere for living around the mining sites.

As India is a democratic nation with a federal system of governance, government at the centre should take care to see that everyone living anywhere in the country should see uniform all-round development which is still a dream. Sympathetic consideration of the demands put by the mineral rich states would help realisation of this dream to some extent and help checking flow of educated youth into the naxal fold. Any kind of carelessness or negligence to the demands of these states would result in public movements and agitations and the states would face strong opposition from people to pursue their industrialisation drive. Such a situation may lead many projects towards uncertainty.

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(Channel Carrying Drain Water into Bay of Bengal at Puri, Orissa)

Photo: Ranjan Ganguly