Odisha seeks mines reservation for its PSUs in MMDR Bill

The Odisha government has impressed upon the Union mines ministry to make provisions for reservation of mine leases for its PSUs in the Mines and Minerals - Development & Regulation (MMDR) Bill, 2014. The Bill seeks to offer iron ore and other bulk minerals through the competitive bidding route.

Deepak Mohanty, state director of mines said, “We have proposed to the Union government that even within the auction process, necessary provisions can be made in the MMDR Bill to reserve mining areas for the state PSUs. The state government has also demanded that the central mines ministry should hold consultation with mineral bearing states before finalising the terms and conditions of the auction.” Union steel & mines minister Narendra Singh Tomar said recently that the MMDR Bill was likely to be tabled in the current session of the Parliament. The Bill seeks to amend the exisiting Mines and Minerals- Development & Regulation Act, 1957.

The proposed auctioning route to lease out minerals has already invited flak from industry bodies like Federation of Indian Mineral Industries (FIMI). FIMI has argued that auctioning may lead to selective mining while leaving low grade minerals in the ground, wastage of resources and inflate the cost of final product, making it uncompetitive vis-a-vis imports.

In Odisha, the Society for Geoscientists and Allied Technologists (SGAT), a body dedicated to promotion of mineral development, has also opposed the grant of new mining leases via the competitive bidding route.

“A land, a house property and illegally extracted minerals can be auctioned but not a mineral property. Reserves available in a mineral deposit is subject to fluctuation with developments in technology. We do not think no developed or developing country has resorted to this practice. Our view is that the proposed auction route will not be in the interest of mineral development,” SGAT said in its views submitted to the Union mines ministry. SGAT has argued that auctioning of mining leases would prevent persons having special knowledge and experience to participate in the bidding process. It said this practice would result in cartelization and the successful bidder may not be obliged to supply ore/mineral to domestic industries and for export. The Bill apart from auctioning of mineral resources, focuses on attracting private investment and latest technology and eliminating delay in administration, so as to enable expeditious and optimum development of mineral resources of the country.

Also, the Amendment Bill seeks to make the offence of illegal mining in respect to notified minerals a cognizable offence. The state governments are asked to set up special courts for trial of offences under the Act, if necessary.