Orissa to gain Rs 1k cr on new ore scheme

Orissa will receive an additional Rs 1,000 crore per annum as royalty charges on iron ore after the Centre’s decision to raise royalty on the commodity, Ashok Dalwai, steel and mines secretary of Orissa said on Thursday.

The Centre recently revised royalty charges on iron ore to 10 per cent ad valorem. Earlier, iron ore miners had to pay Rs 27 a tonne on 65 per cent grade iron ore and Rs 16 a tonne on 62 per cent grade iron ore. Under the new rule, 10 per cent of the selling price of each tonne of iron ore will go to the state government.

“At current price of iron ore, which ranges from Rs 2,000-2,600 a tonne for various grades, we expect to get an additional Rs 150-170,” Dalwai said.

Orissa will get around Rs 500 crore in FY10 (April-March) after the notification, he added.

As per data available with the state government, Orissa received Rs 149 crore as royalty charges on iron ore in FY09 with an overall production of 77.19 million tonnes. “As the decision came in middle of this year, we expect to collect additional Rs 500 crore as iron ore royalty in FY10,” Daslwai said.

About overall mining royalty, he said, “The figure for mining royalty may touch around Rs 1,700-1,800 crore in FY10.”

The state government received Rs 1,340 crore as mining royalty in FY09, he added. Orissa has huge reserves of minerals such as iron ore, bauxite, manganese, coal, and chromite, among others.