Ruling out any leniency in recovering compensation from the erring miners, the Odisha government on Friday said all out efforts would be made to collect the pending dues.
"Mining companies cannot expect the government to be compassionate. If you feel we are coercive in collecting pending compensation, so be it. If the miners are defaulting on payments, their leases are liable to be determined. All other options like seizure of assets are also available to the government”, said R K Sharma, principal secretary (steel & mines), Odisha government.
Sounding a note of warning to the miners, Sharma said, the state government has an elephantine memory and the miners cannot expect the government to forget their faults and condone them. After the Supreme Court order on August 2 last year, the state government had raised demand notices on 131 miners mounting to Rs 175.76 billion. Of this, the government collected Rs 101.8 billion with 44 mining companies yet to pay their share of compensation.
He was speaking at the Ficci Round Table on 'Recent Odisha Mining Scenario”.
"The review petitions by miners pleading for payment of compensation in instalments and extending deadline for paying have already been dismissed by the Supreme Court. Now, the amounts have to be paid. Odisha was the first state to raise demand to recover cost of excess production under Section 21 (5) of MMDR Act and our step has been vindicated by the Supreme Court”, he asserted.
Sharma said contrary to what the miners think, public perception of mining activity was different. “Public perception is that miners made supernormal profits during the boom time of iron ore trade. Mining lessees during that time earned the notoriety of profit seekers. Had miners been cautious then, the scenario would have been different now. But, we believe mining can be made more environment-friendly.”
He ruled out any shortage of iron ore due to the recent closure of seven working mines after December 31. The mines with annual capacity of around 20 million tonnes, were shut after they failed to pay the Supreme Court mandated compensation within the deadline.
"The effect of the closure of six to seven mines would not be much. I believe we will be able to keep up the iron ore production. Also, after 2020, seamless transfers of mining leases is possible. But, the bigger problem would come in the form of exploration”, he added.
Replying to industries' query on higher bids for iron ore blocks at auctions, Sharma said, “High bids are happening because of the desperation of the industry to secure raw materials. This will fade away once more blocks are auctioned. We have to get more and more mines for auctions”.
Speaking on the occasion, Manish Kharbanda, executive director at Jindal Steel & Power Ltd (JSPL) and chairman of Ficci's manufacturing panel suggested reopening of closed mines in the interest of the steel industry and ensuring price moderation. “Since the August 2 judgment of the Supreme Court, iron ore fines prices have been hiked 98 per cent while lumps prices have moved up 60 per cent. This is ridiculous. The price hike has to be passed by the steel industry to the end consumers”, he said.
Kharbanda suggested to the Odisha government to take up the issue of resumption of mines under closure with the central government. Unless this issue is addressed, the steel industry is looking at a bleak future, he opined.
Sanjeev Nandwani, president, Mideast Integrated Steels Ltd said, “Mining in India is viewed as a risky business. This makes it difficult for the miners to avail credit from banks and financial institutions. This perception has to change. Miners need to be allowed more time to pay off compensation and make payments in instalments. Besides, the time lost in litigations should be added to the mining lease periods.”
Prabodh Mohanty, secretary general at Eastern Zone Mining Association (EZMA) stressed on fast-tracking auctions and making the available number of mineral blocks.