The draft mining Bill mandating miners to share 26% of profits with local people displaced by projects will be modified further. The Bill is likely to now include a range of options for the people, like job/s for family members, annuity, a 30-year lease on the land, outright cash settlement or a combination of all or few.
The draft Bill is currently with the group of minister headed by finance minister Pranab Mukherjee and has seen a consensus on the 26% profit-sharing part so far. However, government sources say a view has emerged upon further discussions that giving only the profit-sharing option to people affected by a project would be seen as ?coercive?, and therefore it is better to offer them a bouquet of choice so that they could make the choice as per their preferences.
?Our objective is to ensure that local people are also part of any development project. However, having only the 26% profit-sharing clause in the Bill would be like thrusting down what the government thinks is best. It is possible that somebody may not want profit sharing but is interested in a job instead, or someone else may want an outright cash settlement,? sources said.
Apart from placing better options before the people, expanding the scope would also come as a big relief to some steel companies like SAIL and Tata Steel who are opposed to profit sharing and have found support from the steel ministry. The problem voiced by these companies is that their captive iron ore mines are vertically integrated with their steel manufacturing facilities, and therefore do not have separate profit and loss accounts. In such a scenario, it would be difficult for these companies to share profit with the local people from their existing mines. The problem could be resolved by asking the companies to hive off their captive mines into a separate entity, but so far the government has not taken any step towards it. Even if it were to, the move would be opposed by the companies since vertical integration suits them from pricing and profitability point of view. However, a variety of options gives these companies a chance to convince the local people to accept other forms of compensation.