Royalty Rates Of Minerals Revised

The ministry of steel and mines has increased the royalty rates of major minerals by 8 to 14 per cent.

Union minister of mines B P Baishya said the royalty accruals to the state governments from major minerals would go up by more than Rs 100 crore annually. The revised royalty rates have been arrived at as per the recommendations of the study group constituted by the ministry in 1995. However, these rates will not be applicable in West Bengal.

As per the notification, 17 rates have been fixed on ad valorem basis which is expected to do away with multiple rates for multi-grade minerals and provide buoyancy to revenue accruals to the state governments on par with the market prices.

With respect to gold, the new rate for primary metal is 1.5 per cent of metal sale price on ad valorem basis and its by-product is 2.5 per cent of metal sale price and for silver, it is 5 per cent of sale price on ad valorem basis. In the case of asbestos, the new rate ranges from Rs 31 to Rs 726 per tonne. In the case of iron ore, the revised rates ranges from Rs 2.50 per tonne to Rs 21.50 per tonne. In the case of graphite, the new rates ranges from Rs 28 per tonne to Rs 205 per tonne and in the case of manganese ore, the new rates ranges from Rs 2 to Rs 112 per tonne.

The government has also rationalised the existing grades of classification reducing the number of rates of royalty from 87 to 66.

The government has also revised the rates of dead-rent which will be based on the area of the lease and would increase with the number of years of holding. The dead-rent acts as a deterrent against corner leases and keep them idle.