Mines ministry begins talks with states for new ordinance rules

Consultations to be over by February first week and rules to be notified thereafter

The ministry of mines has started consultation process with state governments to elicit their views for framing rules and regulations before implementing the mines ordinance. The process will be completed by first week of February, a top official of the ministry said.

“We intend to hold consultation with at least a dozen major states having mineral deposits. Till now, we have held workshops with only two states such as Odisha and Karnataka. Next week, our team of senior officials will visit the remaining states to seek view and comments on framing rules and regulations,” R Sridharan, additional secretary, ministry of mines told reporters, here on Friday.

He addressed officials and mining industry stakeholders at a workshop organised by the department of mines and geology of the state government and sensitised them on various aspects of MM (D&R) Amendment Ordinance, 2015.

Sridharan said the ministry would take into consideration the views expressed by various states while framing the rules and regulations for the implementation of the ordinance. The rules will be notified after completing the consultation with state governments, he said.

“The ordinance will be tabled in the Parliament during the Budget session and any changes suggested by the members will be incorporated in the new Act,” he said.

The President of India had on January 12 accorded stamp of approval for the Mines and Mineral (Development and Regulation) Amendment Ordinance, 2015.

Explaining major features of the ordinance, he said state governments are now empowered to have their own system for preparation, certification and monitoring plan of certain minerals specified by the Centre with its approval for the system. Mining lease period will be 50 years and all existing leases shall be deemed to have been granted for a period of 50 years.

All the existing leases, which are granted before the commencement of the ordinance will be extended till March 31, 2020 (for non-captive use) and March 31, 2030 for captive use with effect from the date of expiry of last renewal made or till the completion of renewal period or period of 50 years from the date of grant, whichever is later. On its expiry, the leases will be put up for auction.

Sridharan said the district mineral foundation (DMF), a non-profit body proposed in the ordinance, will be set up by the state government to work for the interest and benefit of mining affected area and individuals. All the major mineral concession holders will be contributing some percentage of the royalty, which will be prescribed by the Centre government very soon.

In case of Karnataka, the DMF will co-exist with a special purpose vehicle (SPV) set up according to the order of the Supreme Court, said Tushar Girinath, Secretary, mines of the Karnataka government. The SPV has an initial corpus of Rs 4,000 crore.

In addition to DMF, the Centre will be establishing National Mineral Exploration Trust, a non-profit body for the purpose of undertaking exploration activities. A sum of two per cent of the royalty will be credited by the mineral concession holders for the trust, Girinath said.

The notified and non-notified minerals will be put for auction for grant of mining lease, if there is adequate evidence to show the existence of mineral content. If there is no adequate evidence to show the existence of mineral content, prospecting licence cum mining lease shall be granted through auction.

Sridharan added the state governments are empowered to set up special courts for the purpose of speedy trial of the offences under this Act. The penal provision for mining offences is enhanced to imprisonment for a term up to five years and fine up to Rs 5 lakh per hectare of the area.