Odisha asks Centre to revise coal royalty sans delay

Batting for the coal bearing states, Odisha government today asked the Centre to revise the coal royalty without further delay besides share in the Clean Environment Cess.
"You would appriciate that these issues are of critical importance to socio-economic development of the state. I am hopeful that you will personally intervene for an early resolution of these issues," Chief Minister Naveen Patnaik wrote to Prime Minister Narendra Modi.
Stating that the coal bearing states contribute to the country's requirement of power and power-intensive industrial sectors, Patnaik said these states have to face the adverse effect of mining such as displacement of people, particularly tribals, reduction in forest area, greater risks of environmental pollution and strain on water resources and infrastractures.

Therefore, the coal bearing states have reasonable expectations of adequate revenue contribution from the coal mining sectors, Patnaik said adding that the rate of royalty for coal, fixed at 14 per cent ad valorem, has not been revised for more than four years now even though the Ministry of Coal has constituted a study group to consider revision of rates of royalty on coal on July, 21, 2014.
While the rate of royalty remained unrevised, the Centre has enhanced the levy of "Clean Environment Cess" to raise Rs 400 per ton in the Union Budget, 2016-17, Patnaik pointed out.
He added that this cess is not shared with the coal bearing states, nor do the coal bearing states get benefits from the funds collected as cess in proportion of their contribution to the cess.

"I have earlier suggested that this cess should be renamed as "Environment and Rehabilitation Cess" and at least 60 per cent of such funds should be shared with the coal bearing states, to deal with negative externalities," Patnaik mentioned in the letter.