 "Rana Som")
Amid mining scams, and consequent curbs, India has lost out on significant production and exports. In an interview with Ishita Ayan Dutt, former chairman and managing director of NMDC, and currently a director and advisor to several private and public sector companies, Rana Som, explains why having a mining regulator is imperative for the sector, which is being probed by multiple agencies. Edited excerpts:
Does it make sense to have a regulator for the mining sector when the sector is already being probed by various agencies?
It is always better to have a single authority dealing with all matters related to mining laws and mining regulations. Now, there are too many authorities. Secondly, the mining industry also needs a forum to represent to. In several states, there have been various interpretations of the existing MMDR Act and there are various interpretations of even the concept of illegal mining.
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However, if the regulatory body's mandate is only to look into illegal mining, then it is not going to add any value to the mining industry. Already, the Shah Commission, the courts and the CEC (Central Empowered Committee) are at it.
What should be the scope of work for the regulator?
Illegal mining is already being handled in different parts of the country. The main issue right now is the way the MMDR Act is being interpreted. For instance, in Odisha, the second renewal of a mining lease is not permitted unless and until the mining company does something on value addition. In Goa and Karnataka, there is a concept of inter-generational production plan, which means that if a mine has 10 million tonnes, the mine's life has to be estimated to be 20 years. So per year, you cannot mine more than half a million. This is operationally, simply not feasible.
There are different interpretations of the MMDR rules in different states and that is causing confusion for the mining industry. It is also causing confusion for those who are responsible for regulating the mining activity today. Therefore, if there is a single authority who will have a pan-India picture before it, it will interpret and implement the existing laws whether it is pertaining to illegal mining or existing mining rules.
The mining companies are troubled today for the different circulars, different orders that are coming every day. So far as Odisha is concerned, they came out with a series of orders, all on the basis of interpretation of MMDR Act.
In Goa, the boundaries of the mines were fixed 60-70 years back. This was done by measuring the area by tape. Now if we decide to do the measurement through GPS, the boundaries will automatically be different. Unfortunately, such difference is being termed as encroachment in many cases. The mining industry has grievance but there is no mechanism for redressal.
What is happening is that these people are running from pillar to post. They are shuttling from one corner to another. This is bad, not only for the mine owners, but also for the industry as a whole.
What is the impact on the industry due to multiplicity of probe?
In Goa, in the past two years, there has been no mining and the whole country is suffering because Goa ore was for exports. Now, the Goa miners are facing probe and answering questions posed by a large number of authorities.
Also, there are court cases and the miners have to defend their position, but even before they present their case, the mines are closed.
Similarly, the Shah committee was set up to observe violation. But even before it came out with its report, the Odisha government took drastic steps and half of Odisha's production was stopped. This is completely ad hoc.
Can you cite some differences in the interpretation of the MMDR Act?
Odisha came out with a series of orders, which are now open to challenge. For instance, for second renewal, the Odisha government is insisting that there has to be proof of value addition. This is a very wild interpretation of the existing mining Act.
Is value addition within Odisha the main cause for concern?
That is not the point. The point is, Goa, Chhattisgarh or Karnataka have not interpreted the Act in that way. MMDR is not a state Act, it is a central Act.
But is the focus of the regulator likely to overlap with the Indian Bureau of Mines (IBM)'s scope of work?
All issues are not handled by the IBM. If there is a regulatory authority, its role is not likely to be in conflict with that of IBM, but it will definitely replace other authorities, which have been acting simultaneously to check illegal mining. lt will also regulate the state governments and restrain them from making arbitrary interpretations of the MMDR Act.
