New policy for mines soon

Move fallows some states' reluctance to share mineral wealth

With certain states showing reluctance to share their mineral wealth with the other states, the Centre is mulling a national mining distribution policy to address the issue, according to a senior official of the steel ministry.

"Recently, some state governments, which hold rich mineral reserves, have expressed their unwillingness to share their raw materials with other states. Keeping this problem in mind, we are planning to bring in a national mining distribution policy in the interests of the industries located in different states," Mano Ranjan, Secretary in the Union steel ministry, told mediapersons here on Wednesday.

Companies like the Visakhapatnam Steel Plant, for instance, were trying to acquire iron ore mines for their future requirements in Orissa.

But the state government told the company that it preferred that any value addition to the state's iron ore deposits should benefit Orissa, instead of it being sold to industries located in other states.

"If every state starts thinking like this, who will feed the industries located in states where raw materials are not available?" Mano Ranjan wondered.

"Four or five states are rich in minerals. Currently, many industries in different states are dependent on these states for raw materials. In the interest of the nation, we have to bring out a national mining distribution policy with the consent of mineral-rich states," the senior official said.

"The Union government had asked for some clarifications on the new steel policy draft report, which was submitted to the Cabinet a few months back. In the next few months, a new steel policy will be unveiled," he said.

"The Centre has given companies like Visakhapatnam Steel Plant and Steel Authority of India Ltd a free hand to enter into joint ventures with foreign mining companies for acquiring stakes in coking coal mines. Currently, two high-level teams are touring Australia and Canada for coking coal mines and we expect some good results very soon," the Mano Ranjan said.

During the last fiscal, Visakhapatnam Steel Plant and Steel Authority faced a shortage of coking coal and had to pay heavy premium for spot purchases of coking coal.

To solve this problem, the government had given permission to these two PSUs to acquire stakes in foreign coking coal mines for their future requirements, Mano Ranjan said.

The country is expected to produce 36"�40 million tonnes of steel this fiscal. While the government has not enforced a ban on steel exports, the steel ministry has asked the PSUs to go slow on exports to meet the high domestic demand.

Tackling a minefield

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• Some mineral-rich states have shown reluctance to sell minerals to industries situated in other states
• The central government is now mulling a national mining distribution policy to tackle the problem
• The government will also unveil a new steel policy within the next few months