s per the Mines and Minerals (Development and Regulation) Amendment Act, 2015, mining lease holders are required to contribute between 10-30% of the royalty towards DMFs.
The Centre wants the states to tap some ‘Rs 25,000 crore lying unutilised’ in district mineral funds (DMFs) to finance the creation of assorted medical testing and screening facilities and buttress the arsenal to combat Covid-19, but the plan might face hurdles. This is because some Rs 31,000 crore out of nearly Rs 36,000 crore accumulated in the DMFs have already been sanctioned for various projects aimed at supporting the people affected by mining projects. Of course, the funds released so far have been just over Rs 12,000 crore. In other words, the untied amount available with DMFs are a little over Rs 5,000 crore only.
There could be political opposition to the Centre’s move and even legal questions might arise if the sanctioned funds are to be re-allocated by the states. As per the Mines and Minerals (Development and Regulation) Amendment Act, 2015, mining lease holders are required to contribute between 10-30% of the royalty towards DMFs.
Mining is a state subject; the 2015 Act empowers the states to prescribe benefits to project-affected persons. The compositions and functions of the DMF are also decided by the states. “We will request the state governments to utilise the funds which are available at the DMF at the district level so that medical testing, medical screening and also providing of health attention will not suffer,” finance minister Nirmala Sitharaman said.
As per the Act, 60% of the DMF proceeds are to be utilised in priority areas and the remaining on ‘other priority areas’. Among the mineral-bearing states, Odisha collected the highest amount as DMF (Rs 9,502 crore) followed by Jharkhand (Rs 5,181 crore) and Chhattisgarh (Rs 4,981 crore). Rajasthan collected Rs 3,514 crore, Madhya Pradesh Rs 2,864 crore, Telangana Rs 2,774 crore, Karnataka Rs 1,842 crore, Maharashtra Rs 1,728 crore, Andhra Pradesh Rs 906 crore, Gujarat Rs 668 crore, Tamil Nadu Rs 610 and Goa Rs 189 crore. When it comes to spending of the proceeds, Chhattisgarh stands first with spending of Rs 3,359 crore till January followed by Odisha at Rs 2,794 crore and Jharkhand at Rs 2,409 crore.