Says Shah commission recommendation faulty; however, accepts other suggestions.
The Union ministry of mines has rejected the M B Shah commission’s recommendations for a ban on iron ore and manganese ore export and has referred the matter to the department of commerce.
“While demand for iron ore is a reality, it cannot be held that exports are the reason for illegal mining. Rather, it is lack of governance at state government levels which has largely contributed to illegal mining. (We feel) a ban on export of iron ore may not be feasible,” the ministry said through an Action Taken Report on its website.
| REALITY CHECK Shah Commission's recommendations and mines ministry’s reaction | |
| Recommendations | Reaction |
| * Ban iron ore exports | Not agreed |
| * Applicant should apply for Forest and State Pollution Control Board clearances, while applying for renewal of mining lease | Agreed |
| * Limiting the period of deemed extension of one year in case of state government’s failure to dispose the application for renewal of mining lease | Not agreed |
| * Mandatory examination of boundary demarcation of lease area | No action required, as provision already exists |
| * Reject application for renewal of mining lease by a person convicted of illegal mining | Agreed |
| * Spacing out boundary pillars and make them visible | Agreed, subject to practical applicability depending on topography of the lease |
| * Construct effective functioning check posts and computerized weighbridges for proper royalty collection | Agreed |
| Source: Union ministry of mines | |
Mining companies were fearing a complete halt in excavation of minerals, largely of iron ore and manganese ore, the two major inputs for steelmaking, if the ministry accepted the Shah recommendations. The rejection is a big relief to them and the steel industry.
“Export of minerals, including iron ore and manganese ore, is guided by the export-import policy, administered by the department of commerce, and the MMDR Act and rules framed therein do not bar export of mineral. The issue has been referred to the department of commerce,” the report said.
The Shah’s commission’s interim report had stated the main cause and incentive for illegal mining of iron and manganese ore was the huge profit from export. It had, therefore, recommended the ban.
While the Federation of Indian Mineral Industries declined to comment, the Goa Mining Association welcomed the move. “The ministry have understood the practical ground reality. We support the ministry’s move, which will help genuine miners to restore business,” said Haresh Mel-wani, CEO of H L Nathurmal & Co, a Goa-based iron ore miner and exporter, also secretary of the Association.
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However, the ministry of mines has agreed to some of the commission’s recommendations, on controlling illegal mining and for recovery of royalty. The report had said, “It is necessary to have effective functioning check posts and computerised weighbridges, since it is not proper to rely only on the reporting by mine owners or transporters.” It has desired systemic solutions, including new rules, computerised weighbridges at exit points for mining clusters or within a radius of 15-20 km from mining areas, developing online system to regulate transportation of minerals, modernisation of check posts and encouraging maintenance of roads by lease holders, and increased use of information technology by the state directorates of mining and geology.
The ministry also accepted the commission’s suggestion that, “any person convicted of illegal mining would stands to lose not only his existing mineral concessions but also be barred from obtaining any in the future.”
Data from the Indian Bureau of Mines (IBM) show production of iron ore fell 4.8 per cent in 2010-11 to 208 million tonnes. The private sector accountd for 70 per cent of ore production. Total iron ore shipment from India was recorded at 95 mt in 2010-11. This fell to 65 mt in 2011-12. India had shipped 117 mt of iron ore in 2009-10.