Nalco pleads mechanism for use of periphery fund

National Aluminium Company Ltd (Nalco) has raised concern over provision for utilisation of 26 per cent profit earned by mining companies for affected people envisaged in the Mines & Minerals (Development & Regulation) Bill.

It has stressed on developing a robust mechanism to ensure optimum utilisation of the periphery development fund where the 26 per cent profits made by miners would be parked.

“Sharing 26% per cent of the profit is not a big issue. But scepticism is about the mechanism to use the fund for the purpose it is intended,” B L Bagra, chairman and managing director, Nalco said at a recent seminar organized by Policy Development Initiatives in New Delhi.

"Unless a robust mechanism is put in place to ensure that the funds collected for the periphery development fund is used for the beneficiaries, this will remain another tax without meeting the target or the objective. Since the amount of funds may be huge, it requires appropriate checks and balances to ensure proper usage,” he added.

The navratna PSU has been providing one per cent of its net profit every year to the Rehabilitation and Periphery Development Advisory Committees (RPDACs) set up by the Orissa government. Till the end of 2011-12, the company has allocated Rs140.06 crore through RPDACs at Koraput and Angul for various periphery development activities.