India never halts buying Iran oil - Mr Reddy

Sunday, 04 Mar 2012

Tehran Times cited Mr S Jaipal Reddy oil minister of India as saying that government is not facing any external pressure on buying crude oil from Iran and will abide by UN sanctions only not those imposed by any bloc of nations.

Mr Reddy said that rejecting US and European sanctions against Iran we respect UN sanctions but will not honor any other sanction. We have cordial relations with Iran and we continue to import oil from them.

US have imposed sanctions that deny access to the US financial system to any foreign bank that conducts business with the central bank of Iran. Besides, European Union has agreed to ban oil imports from Iran starting July 1st 2012 as part of measures to ratchet up the pressure on the Persian Gulf nation's nuclear program.

Mr Reddy rejected US President Mr Barack Obama's statement that demand in China and India was responsible for spiraling international oil prices and said that India's per capita consumption at 442 kilogram of oil equivalent was much lower than world average of 1,715 kilogram. Geo political reasons are to be blamed for spike in global oil prices.

He said that India is currently world's fourth largest consumer of energy accounting for 4.4% of world's annual energy consumption. USA, China and Russian federation are the top 3 energy consumers. Almost 40% of the primary energy consumption is by USA and China.

Mr Reddy said that the energy sector has witnessed major volatility in crude oil prices, scarcity of services and economic meltdown globally in the past few years. Global demand for energy is oscillating in tandem with the economic condition of the world. Economics in the energy sector is also being affected by the dynamics in global political scenario and economic sanctions regime leaving an adverse impact on the demand supply situation.

India is one of the fastest growing economies in the world. Currently, the domestic energy supplies are limited and the import dependence is as high as 80% for crude oil and 25% in case of natural gas. The situation may not change much in the 12th Plan period as the demand for oil and gas is increasing. The share of oil and gas in Indian energy basket is about 40%.

He said that with the projected demand and supply gap, it is imperative for US to enhance energy security for the country for which intense efforts in exploration activities in India as well as abroad are being made.

(Sourced from Tehrantimes.com

Indian government orders CIL to ink FSA to end power shortages

Friday, 17 Feb 2012

Finally, Indian government has acted to alleviate chronic power shortages that hinder its economic growth, ordering its monopoly coal miner Coal India Limited to guarantee long term supplies or face penalties.

It asked CIL to sign 20 year Fuel Supply Agreements with power projects that are due to be commissioned by 2015 and have an agreement with distribution utilities to sell power. This would help power plants with an estimated capacity of more than 50,000 MW.

Until now, Coal India's long term contracts were for a five year period and the last one it signed was in 2009.

A government statement said that the government decision followed intensive lobbying by top executives from India's power companies, who had sought the help of prime minister Dr Manmohan Singh to boost supplies of coal.

Domestic coal supply has fallen short of targets, largely due to regulatory hurdles faced by miners, while poor infrastructure hinders the transport of imported coal, leaving many power plants running below capacity.

(Sourced from Reuters and CNBC TV 18)

Indian iron ore exports to recover to below highs - Mr Trivedi

Friday, 10 Feb 2012

India mining secretary said that India's iron ore exports will recover from this year's depressed levels but will not rise above 100 million tonnes as a crackdown on illegal sales pays off. Mr Vishwapati Trivedi said stricter controls of mining were helping determine the natural level of export his euphemism for legal sales in the long run from the world's third biggest supplier, whose major customer is China.

Mr Trivedi told Reuters in an interview said that "Natural export level is actually an outcome of all this. There will be an export level which ... will be between where we were last year and where we are this year.” Traders have already slashed forecasts for 2011/12 exports from India to around 50 million tonnes, about half last year's figure, dropping it below South Africa in the export rankings. The fall will come after the Supreme Court banned mining in some areas and the government hiked export taxes to crush illegal sales.

In 2010/11, India exported 97 million tonnes of iron ore and has exported about 100 million tonnes a year for several years, mainly to China. But Trivedi said those figures may have included illegal ores. He said that "Natural export level would be over a set of several years when you have got everything going fine, no illegal exports, then you assess the natural levels.”

(Sourced from Reuters)

Government wakes up to J&K coal miners demands

Wednesday, 08 Feb 2012

Minister for Industries and Commerce, Mr SS Slathia said the government will sympathetically consider the demands of coal mine workers in view of the tough nature of their job.

He asked the management of Jammu & Kashmir Minerals Ltd to come up with a workable and financially viable action plan to meet the genuine demands of the workers and employees.

Chairing a meeting of Board of Directors, JKML, Mr Slathia, according to an official statement, constituted a high level committee comprising Commissioner/Secretary, Industries and Commerce, Special Secretary, Finance, Managing Director, JKML and representative from the Law Department.

The committee will examine all the demands of the coal mine workers and employees adding that recommendations and suggestions of the committee shall be deliberated in a Special Board Meeting of the corporation shortly.

Mr Slathia said that “We shall have to take a humanitarian view of the demands and problems of Coal Mine Workers in view of their tough job as compared to other PSUs.”

The Minister asked the management to formulate target oriented and production linked business plan to ensure a sound economic base for sustained growth of the organization.

He also called for introducing Voluntary Retirement Scheme in a big way to minimize wage bill of the corporation.

He directed for increasing coal and gypsum production which has a vast market, adding that production should be the bench mark of the Corporation’s business plan.

He said there is a potential of 3500 tonne of coal and 100,000 tonne gypsum production which needs to be exploited in the next year adding that the Corporation should reactivate its men and machinery to achieve this target.

(Sourced from www.greaterkashmir.com)

Forward e-auction coal may be reserved for power firms

Additional 6-7 mt to be available for the sector if proposal implemented

Tue, Feb 07, 2012

New Delhi:The government is considering reserving forward e-auction of coal, exclusively for the power sector. The proposal could be part of the detailed road map being finalised by the Prime Minister's Office (PMO) for the smooth sailing of power companies amid a severe coal crunch that is hurting investments worth thousands of crore.

The proposal is part of the discussions currently being held by the PMO with representatives of infrastructure sectors, including coal and power, for easing coal availability, according to sources. If implemented, it could make an additional six-seven million tonne (mt) coal available for the power sector. Forward contracts account for 15 per cent of the 45 mt Coal India (CIL) sells through e-auction every year.

The status report and a blueprint for action would be prepared within two weeks to solve the ongoing coal crisis. This could also include asking CIL to supply coal to power companies at a negotiated 85 per cent of the contracted quantity.

The move comes after month-long discussions of a committee of secretaries (CoS) headed by the PM’s principal secretary Pulok Chatterjee. The PMO is currently evaluating a road map to ramp up supply on the basis of the data on expected production received from the coal ministry and discussed in the first meeting of the CoS last Wednesday.

The meeting came a day after the government forced CIL to roll back a 12.5 per cent rise in coal prices due to a new grading system based on gross calorific value. Earlier, power companies had raised the issue with the government.

The PM has emphatically expressed the need to resolve the crisis after taking on board concerns raised by a delegation of power companies’ heads earlier this month, sources said. “At Wednesday’s meeting, the PMO asked the coal ministry the extent of supply of contracted quantity that can be met by CIL so that Fuel Supply Agreements (FSAs) can be signed. The PMO would firm-up a final decision on the matter soon,” a source close to the development said.

Normally, CIL first signs Letters of Assurance (LoAs) with consumers, which get converted to FSAs after the consumer meets certain obligations of project development within a time frame. The LoAs specify the terms and conditions of supply on the basis of a mutually agreed variation in annual contracted quantity (ACQ).

Historically, LoAs have been signed by CIL at 90 per cent of ACQ, meaning CIL would face penalty for a shortfall below 90 per cent and incentivised for excess supply over 90 per cent.

However, the world’s largest coal miner has, off late, started insisting on signing FSAs at only 50 per cent of ASQ, fearing penalty at the back of a severe dip in production. In fact, it has only signed three FSAs since March 2009 as delayed environment clearances took a toll on production.

Around 18,500 Mw capacity power projects commissioned since then – requiring 90 MT coal annually — are likely to operate at 55 per cent of their capacity.

CIL’s output remained flat at 431 mt last financial year. Production during six months ended September this year was down 11 per cent, declining for the first time in the company’s foreseeable history. The company’s share price at the Bombay Stock Exchange on Monday closed at Rs 321.8, up 1.4 per cent as compared to previous close.

(sourced Business Standard)

SC panel suggest cancellation of 49 mining leases

Monday, 06 Feb 2012

Economic Times reported that a committee set up by the Supreme Court tasked with investigating illegal mining in Karnataka has submitted its final report containing recommendations that could radically change how mining is done in the country.

The Central Empowered Committee, in its report submitted on Saturday, has recommended the cancellation of leases of 49 mines that have violated the terms of their licence. It is also believed to have recommended the auction of these leases. These mines produce up to 10 million tonnes of iron ore per year.

The people familiar with the report said that 45 mines cleared of any wrong doing will be allowed to mine as soon as the ban is lifted while 72 other mines will resume only after they have paid penalties.

The collected fines could be used to establish a Sustainable Mining Development Fund and setting up dedicated mining infrastructure for the area.

A moratorium on future leases, until the state has recovered forest lost to illegal mining and established dedicated mining infrastructure, is also on the cards.

(Sourced from ET)

India Govt should exempt levy over coal for affordable power

Mon, Jan30, 2012

NEW DELHI (Commodity Online): To ensure the accessibility of power at affordable costs, the industry body the Associated Chambers of Commerce and Industry of India (ASSOCHAM) wants the India Government to exempt thermal or steam Coal from basic customs duty and countervailing duty.

The customs duty and countervailing duty for thermal or steam coal which increase the power tariff by 25 paise per unit and go against the basic tenets of ensuring long-term fuel sustainability and energy security.

Power sector is one of the highest taxed due to non-availability of any input tax credit on excise, countervailing duty, value added tax and service tax and the imported coal is subject to imposition of 7.55% customs duty for imports from Indonesia and 10.83% for imports from other countries.

According to DS. Rawat, Secretary General, ASSOCHAM, higher power tariff tends to have recessionary impact due to cascading effect on all goods and services. Major countries like the United States, Canada, Australia, Japan and Brazil do not levy any customs duty on import of thermal coal.

In addition, there is countervailing duty of five per cent. This distorts the field in favour of domestic Coal based projects and discourages investments in imported coal based projects.

Also the independent power producers resorting to coal imports are adversely affected by the volatility in prices of imported coal, unpredictable long-term pricing arrangements, volatility in shipping rates and exchange rates, logistical and infrastructural constraints for moving imported coal from ports to power stations.

“To bridge the gap in demand and supply, the emphasis is clearly on importing thermal coal or acquiring new mines abroad. It is anticipated that shortage of domestic coal will continue to persist over the medium term as the additional coal generation programme is not likely to catch up with the growing demand led by aggressive capacity addition to align with economic growth targets.”said Rawat.

Thermal generation (coal, lignite and gas) continues to play 65% share of generation capacity with domestic coal supply not sufficient to meet the requirements.

(sourced Commodity Online.com)

Indian government may make coal imports cheaper for power companies

Monday, 23 Jan 2012

Business Standard reported that the Indian government may ease import of coal to tide over the requirement for power generation companies and other infrastructure utilities.

Official sources said while Customs duty may not be completely rolled back, a partial rollback of the countervailing duty on imports done for power infrastructure projects is being considered by the finance ministry.

They added the consideration is for relaxing the five per cent CVD, if the import was specifically meant for thermal power generation or coal based power plants and related infrastructure projects. At present, there is a five per cent Customs duty on non coking coal, besides one per cent excise duty, announced on 130 items in the last Budget. This was done when the government proposed a levy of one per cent excise duty on 130 items without Cenvat credit.

If Cenvat credit is taken, then these goods will attract a tariff of 5%. This applies to all categories of coal imports lignite, peat, coke, tar, etc. They explained that CVD was imposed to provide a level field for domestic manufacturers and charged at a rate equal to the excise duty.

Cenvat credit means the credit availed by a goods manufacturer in the form of a deduction of input tax paid on the purchase of raw materials, fixed assets, packing material, etc, from the total tax payable to the government.

CVD is also called anti-subsidy duty. Besides industry representation, the power ministry has also suggested to the finance ministry for a relook into the coal import duty structure. It feels while global coal prices have gone up 35 to 40% additional import duty is adding to the cost.

(Sourced from BS)

Coal minister assure more coal for power sector

Thursday, 19 Jan 2012

The Indian government is making all efforts to increase coal production. Target of Coal India Limited of 440 million tones for current financial year will be achieved.

Production from other coal blocks is also being monitored and measures will be taken to achieve increases production from these blocks also. This was stated by coal minister, Mr Sripraksh Jaisawal during a meeting with a group of industrial representing Association of Power Producers.

The minister said the coal linkages are being rationalized, bidding of coal blocks will start soon. He said efforts are also being taken to modernize CIL so that production can be increased significantly.

Mr Jaiswal added that the government is aware of requirements of power sector and is trying its best to sort out issues.

Resume iron ore exports to Japan - Foreign Secretary

Sunday, 08 Jan 2012

India’s foreign secretary Mr Ranjan Mathai has sent an SOS to commerce secretary Mr Rahul Khullar suggesting that he send a team to Tokyo to promptly conclude talks on the Long Term Agreement that fixes ore prices for five years and resume exports.

In his letter, dated December 30th, Mr Mathai underlined the urgency by referring to the assurances given by Indian prime minister Dr Manmohan Singh to his Japanese counterpart Mr Yoshihiko Noda at their recent bilateral summit.

Mr Mathai said that on July 7, the cabinet had cleared the LTA’s renewal and exports by Minerals and Metals Trading Corporation.

He added that “Our iron ore exports to Japan though small has connected us historically and has been the foundation of the present day diversified and intense bilateral trade and economic relationship. The delay in finalizing the LTAs by India has been viewed with concern by the Japanese side.”

The Japanese premier raised the issue with Dr Singh on December 28 during his recent visit to India. He assured his Japanese counterpart that we will address their concern.

As per the existing LTA between NMDC and these nations which expired on March 31 last year each year the PSU supplied 2.3 million tonnes of iron ore to Japanese steel mills. This stopped in February 2011.

The steel ministry had expressed a view that the exports should not be allowed as the Comptroller and Auditor General and the Income Tax Department had raised objections. The CAG had questioned the rationale behind exporting iron ore when local demand for it was on the rise. The I T department criticised NMDC for selling at long term prices instead of spot prices and losing substantial revenues.

(sourced IndianExpress.com)

Indian Finance ministry against canalization of exports

Saturday, 31 Dec 2011

The Indian Express reported that the Indian finance ministry has shot down commerce ministry’s suggestion that canalizing of iron ore exports would be an effective mechanism against illegal exports.

The finance ministry is instead keen to impose fiscal measures as an appropriate tool to discourage unaccounted export of the domestically mined mineral.

The suggestion of senior commerce ministry officials for canalizing iron ores through Minerals and Metals Trading Corporation was ruled out by Mr DK Mittal secretary, Department of Financial Services at a recent meeting convened by Mr PK Misra steel secretary.

According to the minutes of the meeting, “Mr Mittal pointed out that canalization is not the right instrument for controlling ore exports in the long-run. Instead, the Secretary DFS argued that imposing fiscal measures were the most appropriate tools. Mr Mittal further reasoned that canalization could at best be a temporary measure.”

Mr Mittal’s assertions assume importance in the backdrop of the commerce ministry’s recent communiqué telling the Cabinet that instances of private exporters resorting to illegal export of the mineral have been reported, which amounted to circumventing the Foreign Trade Policy.

Demanding tighter regulation of ore exports, the commerce ministry has pitched for canalizing exports of most grades of the mineral including the ones originating from the Goa Redi region to enforce regulation and accountability in exports.

In the note, commerce and industry minister Anand Sharma argued that state governments of Karnataka and Orissa had to intervene to contain illegal mining within their boundaries. So canalizing all ore exports through a single nodal agency MMTC would help curb illegal mining and prevent circumvention of EXIM policy since a single agency as an interim measure would be entrusted with exports and documentation could be checked suitably.

The finance ministry is more concerned about the huge losses incurred to the exchequer due to unaccounted exports of the some grades of the minerals.

In the last Budget, finance minister Mr Pranab Mukherjee had imposed a 20% ad valorem duty on ore exports following a campaign by the steel ministry for disincentivising ore exports as a strategy to conserve the mineral to meet the growing demand of domestic steel makers.

(Sourced from www.indianexpress.com)

New Mining Bill tabled in Lok Sabha

Monday, December 12, 2011

New Delhi: The Mines Ministry today tabled the new Mining Bill in Lok Sabha proposing coal miners to share 26% of the profit and non-coal miners' 100% of the royalty annually to project-affected people.

The Mines and Minerals (Development and Regulation) Bill, 2011, which will replace the over-a-century old, often-amended Act of 1957, also seeks to empower state governments to constitute special courts for the purpose of providing speedy trial of offences relating to illegal mining.

"The holder of a mining lease shall pay annually to the District Mineral Foundation...In case of major minerals [except coal and lignite] an amount equivalent to the royalty paid during the financial year," the Bill proposes.

"...In case of coal and lignite, an amount equivalent to twenty six% of the profit...In case of minor minerals, such amount as may be prescribed by the State government with the concurrence of the National Mining Regulatory Authority," it added.

The long-pending Bill also envisages introduction of competitive bidding process to encourage participation of private parties and a change in the role of the central and state governments, particularly to incentivise them for investing in exploration and mining.

The Mines & Minerals (Development and Regulation) Bill, 2011 provides for a simple and transparent mechanism for grant of mining lease or prospecting licence through competitive bidding in areas of known mineralisation, and on the basis of first-in-time in areas where mineralisation is not known.

(sourced Business Standard)

Indian government update on import of coal

Sunday, 11 Dec 2011

Mr KC Venugopal minister of state for power informed the Lok Sabha that during the year 2010-11, about 8% of the total coal consumed by the Power Utilities was imported coal.

Out of the total coal imported by the Power Utilities, a significant proportion of coal import was from Indonesia. With 10% blending of imported coal with domestic coal, the increase in cost of electricity generation is of the order of 3 paisa per unit for every US $ 10 / tonne increase in cost of imported coal.

Due to the prevailing shortage of coal from the domestic sources for meeting the demand of generation of electricity, import of coal is being resorted to. Increase in prices of imported coal is beyond the control of Government.

Therefore, the Ministry of Coal is being insisted upon to enhance production of domestic coal in the country to minimize dependence on import of coal. Possibility of overseas mining/long term tie up for import of coal is also being explored by some of the Indian companies/Power Utilities.

Jharkhand and centre in coal linkage talk

Monday, 14 Nov 2011

A daylong visit to Jharkhand by union coal secretary Mr Alok Perti proved to be productive for both the state government and the coal ministry.

While the state government sought restoration of coal linkage for the small and medium enterprises, the coal ministry demanded cooperation of the state government in speedy clearance of land for expansion of mining activities in the state.

Mr Perti visited the headquarters of Central Coalfields Ltd at Darbhanga House along with Coal India Ltd chairman Mr NC Jha to review the progress of ongoing and new projects.

While meeting CCL officials, Mr Perti made it clear that the ministry was particular about achievement of targets. He is learnt to have directed the area chief general managers to set daily production target of coal and achieve the targets on a daily basis.

He has also indicated about visiting Jharkhand shortly to review if the directions were being followed.

While discussing action report of each area, aimed at meeting annual target of coal production of 51.5 million tonnes, coal dispatch of 56 million tonnes, over burden removal of 63 million cubic meters and other issues, he said the targets should not remain confined to papers.

Later in the day, he met chief secretary Mr SK Choudhary to discuss various issues related to pending mining projects of the ministry. He said unless the state government is keen about granting clearances on forest, land and environment and assure maintenance of law and order, CCL cannot expand its mining operations.

Responding to the issues raised by the coal secretary, Mr Choudhary assured cooperation and informed that measures to check Maoist disturbance in the mining areas is being taken up joint operations of the state and central paramilitary forces. He said that "We are expected to provide a suitable law and order situation and the issue is being dealt jointly.”

During the meeting, he raised the issue of discontinuance of coal linkage to SMEs causing troubles to the industrial sector. He said that "We expect restoration of the linkage shortly.”

(Sourced from TOI)

FIMI urges not to impose blanket ban on iron ore export

Monday, 14 Nov 2011

The Federation of Indian Mineral Industries has urged the Indian government not to impose a blanket ban on the export of iron ore, as it would affect India's steel industry and result in the closure of captive mines.

Mr RK Bansal FIMI secretary in the letter written to Joint Plant Committee, Union Ministry of Steel, on November 4, has said that there should be no blanket ban or qualitative restriction on ore exports.

FIMI has argued that due to the discontinuation of mining, further exploration would also come to the halt and therefore no further addition to reserves and resources can happen.

Mr Bansal said that "A ban on export will mean that most of the non-captive mines will get closed with consequent adverse impacts on local economy, employment as well as state revenues.”

He said "With the discontinuance of non-captive production, the availability of lumps and high grade fines to the steel industry will get reduced, thus proving counter-productive to the interests of the steel industry.”

The federation has also demanded that export duty should not be imposed as exports provide cushion against fluctuation in demand and prices in the domestic market and vice versa.

It has said that there should be no captive mines allowed to any steel plant, since the domestic iron ore production is already surplus to the domestic demand and will continue to be so for next few years.

FIMI has urged the centre to develop iron ore mining as a standalone mining industry, separate from steel industry, so that, both could work at arm's length and benefit from each other's strength and innovations rather than take shelter behind the safety net available.

(Sourced from ET)

India Gives Conditional Approval to Coal India for Investment Overseas

Tue, OCT18,2011

NEW DELHI - India's federal government has given conditional approval to Coal India Ltd.'s long-awaited proposal to buy unlisted units of listed mining companies overseas, a senior coal ministry official and a senior company official said Tuesday.

The permission is subject to Coal India investing in overseas projects that offer a rate of return of at least 12%, the officials, who declined to be named, said. The state-run company has also been asked to "carefully" evaluate the target companies, the officials said.

Delays in getting approvals have hurt the world's biggest coal producer, as it wasn't able to proceed with its stake purchase talks with U.S.-based Massey Energy Co., Australia's Peabody Energy Corp. or Indonesia's Sinar Mas Group's PT Golden Energy Mines. Coal India sought the approvals in May.

The officials said if the projected rate of return of a target company is less than 12%, the government will consider such proposals on a "case-to-case" basis.

"Normally, projects with both financial internal rate of return and economic internal rate of return of 12% may be taken up for investment abroad," the coal ministry official said.

"However, in exceptional cases where the administrative ministry is of the opinion that such investments are of strategic interests for energy security of the country, the proposal may be referred to the Department of Expenditure for special dispensation on a case-to-case basis."

The Coal India official also said the company recently lost out to India's GMR Group in acquiring a 30% stake in Indonesia's PT Golden Energy Mines due to delays in getting government approvals.

"The mines of the company [PT Golden Energy] had a rate of return of more than 12%," the official said. "Peabody's proposal had a rate of return of less than 8%, so it is out of question and in Massey's case, the new management is yet to come back to us. So, we have practically nothing in hand now," the official said.

Coal India had shortlisted Peabody's Wilkie Creek mine and Massey's Sidney Underground Mines to buy stakes. Massey reached a $7.1 billion cash-and-stock acquisition deal in January with Alpha Natural Resources Inc.

The Coal India official said the company may now seek fresh proposals for investment in overseas companies, a move that's likely to further delay its plans to buy more coal mines overseas and bridge a domestic coal shortage. The company's only overseas reserves so far are two coal blocks in Mozambique.

(sourced Dow Jones Newswires)

Mining bil cleared, firms to share 26% profits with locals - NDTV

Friday, 30 September 11

NDTV reported that, The Union Cabinet cleared the draft mining bill aimed at regulating mining activities Friday. The bill proposes a profit-sharing system and bidding of mining rights. It will mandate coal companies to provide 26 per cent of post-tax profit for the welfare of affected people, a move intended to benefit mostly tribals.

Niraj Shah, Senior VP (Equity Research) at Fortune Financial Services (India) Ltd said, "The biggest negative will be on Coal India... 26 per cent profits would be transferred and will be calculated on previous years' profit. So, the EPS would be impacted."

Coal India slumped 3 per cent post the decision and was the top loser on the 30-stock Sensex.

Bhavesh Chauhan of Angel Broking said the biggest impact will be on Coal India followed by Hindustan Zinc. "For Coal India, there is a cushion of passing prices to customers because it sells coal at a subsidy," Mr Chauhan added.

Companies that have captive coal mines will also be affected, Mr Shah said. "Profit will be calculated on the basis of mine head costs and the transfer pricing, so power and steel companies will be impacted," Mr Shah added.

The Mines & Minerals (Regulation and Development) Bill, 2011, which seeks to replace a 1957 act, also provides for setting up of National Mining Regulatory Authority and Tribunal and formation of District Mineral Foundations in 60 mineral-rich districts across the country. The states will also be advised to set up authorities and tribunals on these lines.

The Bill, which advocates "sustainable and scientific" mining, also suggests non-coal miners like bauxite and iron ore firms to share an amount equal to that of royalty with local residents instead of just sharing profits.

A 10-member ministerial panel set up in June last year, has finalised the methodology ensuring that people in mineral-rich districts of Andhra Pradesh, Orissa, Chhattisgarh, Goa, Jharkhand, Karnataka, Madhya Pradesh, Maharashtra, Rajasthan, Uttar Pradesh and West Bengal get monetary benefits from mining.

If the bill is passed, an estimated amount of Rs. 10,000 crore (approximately US$ 2.042 billion) will be generated per year from miners and an average amount of Rs. 180 to 200 crore (approximately US$ 36,754,535 to 40,838,239) will be distributed among District Mining Foundations of 60 mineral rich districts that include 25 districts affected by Left Wing Extremism.

Mr Shah said money will be transferred to an escrow account that would be used for the benefit of the tribals.

(sourced NDTV)

India to restrict entry of ships over 25 years of age

Sunday, 11 Sep 2011

Union Minister of Shipping, Mr GK Vasan informed the Lok Sabha that the government has decided to impose certain restrictions on the entry of over 25 year old ships into Indian ports or territorial waters.

The Minister said that most of the ships involved in accidents/collisions were very old. Therefore, the government will be issuing a notification under the Merchant Shipping Act, 1958 that if the ships are more than 25 years old they will be allowed in only if they satisfy the following conditions:

1. They should be classed with classification societies which are full members of the International Association of Classification Societies.

2. Have adequate insurance coverage for liabilities including collision, wreck removal and salvage.

3. Appoint an Indian ship agent to represent owner/charterer.

4. The Indian agent should notify the port authority and the Customs collector at least 48 hours prior to arrival, details of the ship including insurance etc.

There are about 93 Indian flag ships which are above 25 years of age. However, they will not be affected as they are all classed with the Indian Register of Shipping, which is a full member of IACS.

(Sourced from Exim News Service)

SC panel calls for ban on all private mining in Karnataka

Monday, 22 Aug 2011

TOI reported that Central Empowered Committee, an environmental panel that reports directly to the Supreme Court, on Friday recommended a complete ban on iron ore mining in Tumkur and Chitradurga districts of Karnataka, which border the now notorious Bellary district.

Agreeing with the state lokayukta, the anti corruption watchdog, the CEC filed a report before the apex court that said large scale and reckless mining was being carried out in these districts, particularly by private companies, seriously destroying the environment.

A three judge green bench headed by Chief Justice of India Mr SH Kapadia and including justices Mr Aftab Alam and Mr Swatanter Kumar sought the response of the union and the state government, as the CEC said mining was being conducted in an environmentally unsustainable manner for short-term gains.

The committee said much forest had been lost due to illegal mining of iron ore over 2,678 hectares in Tumkur and Chitradurga, with illegal mining and production in excess of the size of lease.

The report said that ''This court's July 29th order, by which mining operations have been suspended in Bellary, may be extended in respect of the mining leases in districts of Tumkur and Chitradurga.”

Submitting the CEC's report to the court, amicus curiae ADN Rao said the adverse impact on the environment in these two districts was identical to that seen in Bellary and advocated controlled mining as has been ordered by the apex court in Bellary.

This could in effect mean that all mining by private companies in Karnataka will be banned. In Bellary, after the Supreme Court order, mining is done only by state-run companies, and is meant to meet the requirement of the domestic steel industry, as export of iron ore has also been banned by the state government.

(sourced from TOI)

No plan to ban iron ore exports from India - Mr Sharma

Sunday, 21 Aug 2011

PTI reported that Indian union minister for commerce and industry Mr Anand Sharma ruled out a ban on iron ore exports, saying the surplus mineral must be exported.

Mr Anand said that "A considered view had been taken that the exports of iron ore must continue. India has enough surplus particularly of iron ore fines.”

He added that domestic industry largely uses iron ore lumps, while the country exports mainly iron ore fines.

Mr Sharma said that "Therefore, mined iron ore which is in surplus must be exported.”

The issues had arisen following an apex court order of late last month, banning on all mining activities in Bellary in Karnataka. The apex court in its subsequent hearing later on August 5 partially lifted the ban and allowed only state run NMDC to carry out mining activities in the region with a cap of 1 million tonnes per month. The apex court had also said that iron ore produced from the Bellary region will not be exported.

Mr Sharma said that "This particular intervention by Supreme Court was on a limited context on what was happening, particularly in the state of Karnataka in Bellary, where there was illegal mining of iron ore. Illegal mining is taking place in some other parts of the country as well, but that does not lead to a situation where that iron ore does not get exported. This issue will get suitably resolved.”

(Sourced from PTI)