States seek sharply higher royalty on iron ore: Govt

Leading iron ore producing states such as Chhattisgarh, Odisha and Jharkhand have demanded hike in royalty rate on the raw material to up to 32 per cent, from 10 per cent now, Parliament was informed today.
Minister of State for Steel and Mines Vishnu Deo Sai said in a written reply in the Lok Sabha today that mineral-rich states had sought an increase in existing rates of royalty on various minerals.
"Specifically with regard to iron ore - Andhra Pradesh, Chhattisgarh, Jharkhand, Odisha, Rajasthan - have demanded a hike ranging from 12 per cent to 32 per cent on ad valorem basis from the existing royalty rate of 10 per cent on ad valorem basis," he said.

The ministry has recently floated a Cabinet note for an inter-ministerial discussion proposing hiking the rate of royalty on iron ore to 15 per cent. The rate is revised every three years. Last revision, however, was made in 2009.
Sai said his ministry constitutes study groups at regular intervals to study the demands made for revision the rates of royalty on minerals and dead rent to make recommendations.
"The most recent Study Group report was received by the government on June 28, 2013. No decision has been taken by the government on proposed rates of royalty," he said.

Replying to a separate question, Sai said state-run iron ore miner NMDC has spent Rs 483.63 crore on corporate social responsibility in the last eight years starting with 2006-07.

"Out of the total CSR expenditure, an amount of Rs 382.64 crore was spent in Chhattisgarh," he said.
To another question, he replied that although steel production in the country had been continuously increasing during the last three years, the rate of growth in production was declining due to various factors such as slowdown in the economy.
Sai said substantial manufacturing facilities for steel plant equipment are located in various parts of the country in the private sector.
"In addition, Danieli C, Italy has set up a manufacturing facility for steel equipment at Sri city, near Chennai and SMM, Germany, is also setting up a manufacturing facility near Bhubneswar," he said.