Virbhadra, Handique on collision course over allocation of mines

Written by Rituparna Bhuyan | New Delhi | Updated: Dec 16 2009, 07:02am hrs
Union mines minister Bijoy Krishna Handique has rejected steel minister Virbhadra Singhs demand to have a greater say in the allocation of iron ore, manganese and chrome ore mines. Differences between the two ministries have already delayed the new law for mines and minerals development, which the UPA government intended to take to Parliament in this session.

Handiques missive to Singh has asserted that Centre should only regulate mining rather than controlling it and therefore, the new Mines and Minerals Development and Regulation (MMDR) Act (to replace the existing 1957 law) intends to make state governments the sole authority for granting mining concessions, which include reconnaissance permit, prospecting license and mining lease.

The two ministries have been engaged in a turf war over a proposed clause in the new MMDR Act that proposes to limit the Centres role in mine-related permissions to that of a regulator. At the moment, mining projects can be developed only after New Delhi grants prior approval to mining concessions proposals recommended by the states.

Singh has been demanding that the steel ministry should be given the responsibility of dealing with matters related to the three minerals that hold the key to steel outputchrome, iron ore and manganese. Mines minister Bijoy Krishna Handique has maintained that the role of the Centre should be limited to regulating the sector rather than controlling the mineral concession regime.

If the mines ministry is finding it difficult to regulate and manage the procedure of grant of prior approval of mineral concessions for major minerals, ministry of steel is willing to take over this function of grant of prior approval for mineral concessions for iron ore, manganese and chrome ore, if the procedure of prior approval of central government for grant of mineral concessions of these minerals is continued, Singh had said in a letter to Handique in November.

Rejecting the demand, Handique said the powers of the central government in the grant of mining concessions are notional. I would have to take this opportunity to point out that the power of prior approval with the central government is, indeed, not real power since all the proposed mineral concessions have to be recommended by the state government, and no person not recommended by the state government can be approved by the central government. And most importantly, this power cannot be exercised, in case, state government are not willing to forward mineral concession proposals to the state government, Handique said in the letter.

The steel ministry has been demanding a say in the mines approval process as it feels that state governments are notorious for delays in granting mining approvals and permissions. But the mines ministry is of the opinion that state governments should be made responsible and accountable for their role in dealing with approvals and there are adequate mechanisms in the proposed amendments to the MMDR Act to ensure this.

The role of the central government should be aimed at regulating the sector rather than controlling the mineral concession regime, for which the provisions of the draft Act has been elaborated to define the role of stake holders in the dispensation of concession, Handique said.

Matters related to mines are in the concurrent listboth Centre and states have respective legislations on the sector. Pressing upon his arguments on the issue, the steel minister had maintained that if the powers of the central government are taken away, then there may be charges of abdication of constitutional duties. Defending the proposed MMDR Act, Handique wrote that power to grant Prior Approval is not derived from the Constitution, but from a Law of the Parliament.

Singhs missive came after a meeting between mines secretary Santha Sheela Nair and the then steel secretary P K Rastogi on October 14. We need a tighter policy framework for mining under the control of the central government, which is in a better position to decide how national resources like strategic minerals are to explored, produced and used, steel secretary Atul Chaturvedi had recently told FE.

Currently, the mining sector, excluding coal, lignite and atomic minerals, are governed by the MMDR Act of 1957, which has been amended six times. After the National Mineral Policy was introduced in 2008, it was decided to amend the existing Act. However, the amended Act will be based a fresh set of norms.

The draft Act was circulated for discussion in July 2009 and stakeholder meetings on the proposals have taken place in August and September. Subsequently, a modified draft Act was prepared by mid-September and workshops held to discuss it in October.

The Bill on the new MMDR Act was scheduled to be introduced in the winter session of the Parliament, but that could not happen as inter-departmental consultations to finalise the provisions of the proposed legislation could not be finished. The mines ministry has now circulated a draft Cabinet note on the Act.

After getting a green signal from the Union Cabinet, the amendments will be sent for approval of Parliament.