New mining law

The Union Cabinet is set to approve a law that will provide more rights to tribals for the beginning and end of mining activity besides providing Rs 10,000 crore annually to 60 tribal dominated districts. The bill for the new mining law and the repeal of the Mines and Minerals (Development and Regulation) Act, 1957 is on the agenda for the Cabinet meeting scheduled for Friday. The bill, expected to be introduced in the next session of Parliament, proposes that coal companies set aside 25% of their post-tax profits into a fund. In addition, an amount equal to the royalty for iron ore, bauxite and limestone will also flow into the fund. The corpus is proposed to be spent across 60 tribaldominated districts in Jharkhand, Chhattisgarh, Orissa, MP and Karnataka with each district getting Rs 180 crore on an average every year. Of the 60, around 24 districts are badly hit by Naxal violence, officials said. The proposal in the draft bill going to the Cabinet is, however, a dilution from the original plan which envisaged a 25% levy on all mining activity – and not just coal. But the plan was dropped by a group of ministers headed by finance minister Pranab Mukherjee after intense lobbying by private companies and backing from the Planning Commission. Apart from the fund, the bill has also proposed that any mining right can only be granted by the government after consulting the local community. Ditto for putting an end to mining activity.