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Cost of mining will go up: Miners on new mines law

New Delhi: .The cost of mining is set to go up with the passage of the new mining Bill that mandates miners to pay more for project affected people, according to industry officials.Mines and Minerals

PTI [ Updated: March 22, 2015 9:42 IST ]
cost of mining will go up miners on new mines law
cost of mining will go up miners on new mines law

New Delhi: .The cost of mining is set to go up with the passage of the new mining Bill that mandates miners to pay more for project affected people, according to industry officials.

Mines and Minerals (Development and Regulation) Amendment Bill, 2015, provides for the same amount of royalty payable by existing lease holders in the District Mineral Fund (DMF) and one-third of the royalty for those who will get mines after the enactment of the new law.

Provision for payment towards DMF was not there in the 1957 Act of the same name which would be replaced by the new Act. Thus, this is an additional burden for the miners, who now pay between Rs 8 and Rs 27 per tonne.

"As miners will have to pay towards DMF, their production cost will go up which they will obviously try to pass on to end-users and as a result, common people will suffer," miners' body FIMI's Secretary General R K Sharma said.

With the prevailing subdued global commodity prices, the price of raw materials, especially of iron ore, has fallen so much that users might resort to more imports if the domestic prices do not match and as a result, mining activity can also hamper, an industry sources said.

However, they were happy with the fact that at least the new Bill will bring in transparency in the allocation of mines which was so far given through the dispensation route.

At the same time they were apprehensive that people with more money may hoard mines at the expense of small and marginal players leading to situation where only a wealthy few will rule the roost.

Steel and Mines Minister Narendra Singh Tomar however said that the new bill will bring a revolutionary change into the sector which was plagued by different issues including ban on mining.

"Apart from ushering in transparency in mines allocation process, the Bill will bring in a revolutionary change in the sector. It will also attract more investment to the sector, enhance expertise and income of those employed with the sector," Tomar had said.

 

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