Goa to allow mining in phased manner

Iron ore mined in Goa, 90 million tonnes a year before the Supreme Court ban, was largely exported to China

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The government of Goa has decided to grant leases for mines in phases, in line with the recent Supreme Court (SC) order giving this power to the state government.

This is a relief for India’s steel industry and for iron-ore mine owners.

“For granting licences, however, the government has trifurcated the existing leaseholders. Holders who have paid stamp duty, in which there are no violations found in terms of the M B Shah inquiry/Public Accounts Committee report, shall be considered for renewal in the first phase,” said Chief Minister (CM) Manohar Parrikar in a note on Wednesday.

At the time of the mining ban in 2012, there were 105 mines with environment clearances, of which 97 were operational. Iron ore mined in Goa, around 90 million tonnes a year before the ban, was largely exported to China.

The CM said lease grants will be given only after compliance, such as the requirement of a report from the Indian Bureau of Mines and after the state government has in each case concluded it was in the interest of mineral development.

The government will consider imposing charges prospectively and retrospectively for the recovery of stamp duty and other liabilities, in addition to royalty, plus payment of 10 per cent of the sale proceeds to the Goa Mineral Permanent Fund. It may reject applications for a second renewal where there have been breaches of mining guidelines.

The SC had recently directed the state government to decide the manner in which leases were to be granted in the future.

The first lease permission for mining of ore had expired in 2007. A number of mines had applied for renewal and continued operations in the absence of a decision. The state government allowed the working of mines from 2007 till 2012 on a deemed extension basis, without actually dealing with the renewal applications. The SC order of April 21 had held the action of allowing mines to run on deemed extension from 2007 to 2012 illegal.

Parrikar said the stoppage of mining had cascading effects, impacting not only those directly involved but allied activities too, including financial institutions that had lent to the companies, operators and transporters.

Further, exposure of financial institutions Including banks is more than Rs 850 crore as loan/ advance on mining sector to trucks, barges, mining machinery etc. to small time operator besides which advances of housing / consumer loan and other mining companies exceeds Rs 1,000 crore.