Supreme Court nod wont bring Goa mining on stream soon

Written by fe Bureau | New Delhi | Updated: Apr 22 2014, 15:50pm hrs
GoaThe SC had banned mining in Goa in October 2012, following a report of irregularities by the Justice MB Shah Commission
The Supreme Court on Monday lifted the nearly one-and-a-half -year ban on iron ore mining in Goa, but it would take some time before the companies can resume mining in the state. This was because the apex court cancelled all mining leases in the state, which were continuing in perpetuity on the basis of deemed renewal and asked the state government to formulate a policy and grant fresh licences.

However, the apex court can examine the constitutionality or legality of the decision of the state government by exercising its power of judicial review.

The lifting of the ban was subject to the capping on extraction at 20 million tonne per annum, a bench comprising justices AK Patnaik, SS Nijjar and FMI Kalifulla said. However, an experts panel would give a final recommendation on the annual cap on excavation of iron ore within six months.

The SC said that after 2007 there cannot be a deemed renewal of the existing lease deeds emanating from 1962. It also said that there would be no grant of lease for mining around 1 km of national parks and wild life sanctuaries. The deemed mining leases of the lessees in Goa expired on November 22, 1987, and the maximum of the 20-year renewal period of the deemed mining leases in Goa expired on November 22, 2007. Consequently, mining by the lessees after November 22, 2007, are considered illegal.

The SC had banned mining in Goa in October 2012, following a report of irregularities by the Justice MB Shah Commission.

It had ordered setting up of another six-member panel asking it to file a report by February 15, 2014, suggesting the annual cap on the volume of iron ore to be extracted. The committee had recommended that mining be allowed in the state subject to an annual cap of 20 MT. The total production in Goa, before the ban came into effect, was around 45 mt.

The apex court had on November 11, 2013, allowed e-auctioning of nearly 11.48 mt of extracted iron ore lying unused in Goa since it halted mining.

Once the top Goa-based miners such as Sesa Sterlite (earlier Sesa Goa), Fomento Resources and the Salgaonkar Group of Companies and a few others start mining, their output would decline by more than a half.

Iron ore produced in Goa is of a low Fe content, and hence is exported primarily to China, Japan and West Asian countries. In 2011-12, Goa accounted for almost 20% of the countrys production and 60% of 60 mt tonnes of exports.

The apex court also directed the ministry of environment and forests to identify ecologically-sensitive areas around national parks in the next six months, the Goa government to formulate a scheme within six months for utilising the funds generated by e-auction, and that the workers on rolls of all mining firms be paid 50% of the wage during the period for which they were out of work.

The lifting of the ban has been welcomed by the industry. It is a very good thing to happen. This will bring the mining industry back in Goa. It will create employment and boost the economic activity, Federation of Indian Mineral Industries secretary general R K Sharma said.