India Inc gives a thumbs up to mining reform bill
- Once the bill becomes law, there will be no distinction between captive and non-captive mines, captive mines will be allowed to sell up to 50% of the minerals excavated during the current year and will also help towards the auctioning of more mines
New Delhi: Industry lobby group Federation of Indian Chambers of Commerce and Industry (Ficci) has given a thumbs up to the government’ efforts for getting the Mines and Minerals (Development and Regulation) Amendment Bill, 2021 passed in Lok Sabha on Friday.
Once it becomes law, there will be no distinction between captive and non-captive mines, captive mines will be allowed to sell up to 50% of the minerals excavated during the current year and will also help towards the auctioning of more mines.
Also, the union government will be able to conduct auctions for those blocks wherein the “state governments face challenges in conducting auction or fail to conduct it,” with the revenues accruing form such blocks going to the state government’ exchequer.
“Cooperative federalism is at the heart of our decisions. Powers have been delegated to States for grant of mineral concessions. We propose to assist State Govts in conducting auctions if they fail or face challenges,” said coal and mines and parliamentary affairs minister Pralhad Joshi in a tweet.
As part of the government' efforts to usher in structural reforms in the mining sector, the bill that amends some sections of the Mines and Minerals (Development and Regulation) (MMDR) Act will now go the Rajya Sabha during the current budget session of the Parliament.
“FICCI acknowledges Government’s efforts to deliberate and usher recent reforms in the Indian mining sector. These reforms will play a fundamental role in enhancing mining sector’s contribution to the employment and GDP of the country, contributing immensely to the vision of Atmanirbhar Bharat,” Ficci said in a statement.
National Mineral Policy has a goal to increase mineral production by 200% in 7 years. Of India’s obvious geological potential area of 0.571 million sq. km, only 10% has been explored.
“The introduction of composite license regime would enhance mineral exploration and production in the country, alongside attracting investments both from domestic as well as foreign investors,” said Sumit Deb, chairman and managing director at state run NMDC Ltd said in the statement.
Going forward, all clearance and licences granted shall continue till the reserves have been mined and post the expiry or termination of the lease, will be transferred to the next successful bidder. This will help attract investors as under the previous regime, the new lessee had pre-embedded clearances for only two years, making it difficult to get fresh clearances within this time period.
According to the statement, Deb who is also the co-chair of Ficci mining committee acknowledged the reform of exploring the possibility of making National Mineral Exploration Trust (NMET) an autonomous body, for better utilization of NMET funds and increasing the mineral exploration in the country.
This law-making exercise assumes significance given that the mineral sector contributes only 1.75% to the country’s gross domestic product (GDP), with India importing minerals worth ₹2.5 trillion annually.
“We produce around 1.25 lakh crores worth of minerals while we import around 2.5 lakh crores worth of minerals,” Joshi said in anothe tweet.
The amendments also simplify the exploration regime, do away with any charges on transfer of mineral concessions for non-auctioned captive mines, rationalize stamp duty payable on mining, and development of a National Mineral Index for introducing an index-based mechanism for making statutory payments. Also, there will be changes to the district mineral foundation fund, a social impact fund that miners have to contribute towards.
“Outcomes of District Mineral Foundation will be more visible. #MineralReforms to resolve legacy issues and clarify mining definitions so that their interpretations may not hinder activities, but support it,” Joshi said in another tweet.
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First Published:20 Mar 2021, 10:39 AM IST
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