Mining big revenue, job generator: strategy paper (Herald)

Mining big revenue, job generator: strategy paper August 10, 2013 TEAM HERALD PANJIM: The contribution of the Goa mining industry to the GDP will be 14.2 %, the number of jobs generated will be 50,000 and royalty earned by government will amount to Rs 1500 crores, by the year 2025, a Union Ministry of Mines strategy paper, that documents the expected growth of the industry of the top 7 mining states including Karnataka till 2025, says. The paper titled ‘Unlocking the Potential of the Indian Minerals Sector’ also goes on to say that all state mining sectors will grow by 10 per cent. It argues that the contribution of mining to the state GDP would increase substantially by 2025 while employment in most of the mining states will increase to 1–2% of current working population while contribution of royalty will be 40-70% of current state revenue receipt in most of these mining states (by 2025). However, the paper points out that this acquisition of key minerals has to be centrally coordinated and will require designating a ‘central resource planning cell’ under the Union Ministry of Mines to support PSUs and private sector in international resource acquisition of strategic minerals. This cell has to conduct a 25-year demand-supply analysis for India and prioritise the resources to be acquired as well as to prioritise the geographies to be targeted for resource acquisition or supply. Government should support PSUs in facilitation process and clearances, providing expertise, gathering intelligence, and resolving conflicts on priority, when multiple companies are bidding for the same resource. Support should also be given to the private sector in acquiring resources through government relations, facilitating cross-ministry approvals, and post-acquisition infrastructure development, the paper says. It specifically pushes for development of “a comprehensive India offering to the partner state (infrastructure development, trade benefits, support in other causes); support (for) Indian projects through embassies, and facilitate interaction between regulators in resource-rich countries and Indian companies” and wants “funding (to be provided) at attractive terms for infrastructure setup in underdeveloped countries and to gain an operating stake in high-ticket deals. Reducing permit delays to create a more favourable policy environment is one of its focal points. The paper stresses the need for authorities to address permit delays by reducing permit timelines for mining leases from five to eight years to below two years; to reduce uncertainty in time and outcomes while awarding permits for mining. A joint exercise with the MoEF has to be conducted to jointly rationalise process and speed up forest and environment clearances. Also besides CEC meetings, forums every quarter with MoEF and National Land Records Modernisation Programme to jointly take stock of priority projects—such as status database for all pending applications for environment and forest clearance, and land reclassification for priority districts. Also a national database for forest and environmental clearance rather than a partitioned database for Centre/state and forest/environment should be created. Permissions for mining lease grants in the priority areas (it currently takes 24 to 30 months) should be and setting up defined timelines for each intermediate step are important, says the paper specifying: technical opinion—five months; opinion on forest land—five months; revenue opinion—five months; recommendation by state—four months; approval by Ministry of Mines – three months and mining plan approval—three months. Importantly in conformance with the draft MMDR Act, it wants the state to improve regulatory system in IBM for approval and monitoring of mining plan and enforce critical components of sustainability through regulatory changes like increase financial commitment for mine closure. The contribution of mining to the State GDP would increase substantially by 2025 while employment in most of the mining states will increase by 1–2% of current working population and contribution of royalty will be 40-70% of current state revenue receipt, forecasts the strategy paper