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World's Commodity News, Government policies, No curbs on iron ore exports from Orissa

News courtsey via Business Standard Reporter / Kolkata/ Bhubaneswar December 23, 2010, 0:55 IST

Even as the ban in iron ore exports by the Karnataka government continues to be shrouded in controversy, the Orissa government has stated that there would be no curbs on iron ore exports from the state.

"The Government of India has decided that iron ore exports from Orissa cannot be stopped”, minister for steel & mines Raghunath Mohanty said in the state assembly.

The minister's comment came in response to a query by senior BJP leader K V Singh Deo who had questioned as to whether the state had any plan to restrict iron ore exports in the light of a ban on exports of the ore announced by the Karnataka government.

On value addition of mineral ores within the state, Mohanty said, “the Central government has to take a call on the matter. If the value addition clause is incorporated in the proposed Mines & Minerals (Development and Regulation) MMDR Bill-2010, all the mineral rich states would be benefited. The state Chief Minister Naveen Patnaik was the first person to raise the demand for including a clause on value addition in the MMDR Bill”.

The demand for value addition clause was made by the state Chief Minister last month during his meeting with the Union finance minister Pranab Mukherjee who is heading the Empowered Group of Ministers (EGoM) on finalizing the MMDR Bill. This apart, the state has demanded the introduction of a system of competitive bidding in notified mining lease areas of the country for allocation of bulk minerals like iron ore, chrome ore and bauxite which is in conformity with international practices.

The state had argued that in the petroleum sector, allocation is done through competitive global bidding and the Government of India is thinking of allocating coal blocks through this route. The same practice must be extended to precious mineral ores like iron ore, bauxite and chrome ore, Mohanty said.

This apart, the state government has suggested that the Royalty Commission should be empowered to fix royalty rates for different minerals instead of making mere recommendations to the Government of India.

While welcoming the proposal in the MMDR Bill-2010 which would make it mandatory for the miners to share 26 per cent of their profits with the local affected people, the state government has suggested that a Local Community Development Fund can be constituted for this purpose.

In addition to this, the Orissa government has sought reservation for public sector undertakings and SMEs (Small and Medium Enterprises) in the mining lease areas. The state government has pleaded for the inclusion of the value addition clause in the MMDR Bill which can unleash rapid economic development in the mineral bearing states.
The state government was open to setting up of the National Mineral Regulatory Authority (NMRA) on the condition that the regulator can adjudicate on cases pertaining to mineral concessions and recommendations of prospecting license, but should not override the powers of the state governments.

It has been decided to set up an independent regulator called NMRA through an ordinance under the existing MMDR Act. The independent regulator will have the powers to investigate and prosecute miners involved in illegal mining.

The regulator is being set up in the wake of alleged increase in illegal mining activities in different states including Orissa.Earlier, the state government urged the Government of India to put in place a monitoring mechanism to ensure the effective implementation of the changes proposed in the MMDR Act, 1957.

The state had argued that the monitoring mechanism would ensure that the measures are implemented effectively and the benefits of mining activities percolate to the affected people.

Tags : Karnataka government, Orissa government, Raghunath Mohanty, K V Singh Deo, MMDR  Bill-2010 EGoM, iron ore exports