Retired IAS officer Praveen Kumar to head national mineral index panel

By: |
July 23, 2021 7:00 AM

The NMI will determine the value of the minerals that will form the basis for calculation of royalty and other such levies of selected minerals, and so its recommendations are crucial for government revenues.

Mineral indexThe Kumar-led committee has sought comments from states, industry and other stakeholders on formulation of NMI for various minerals.

Praveen Kumar, a retired IAS officer, will head the committee to develop a national mineral index (NMI), the government said in an order earlier this month. Kumar replaces former coal secretary SK Srivastava, who had been the chairman of the panel since April 6.

The NMI will determine the value of the minerals that will form the basis for calculation of royalty and other such levies of selected minerals, and so its recommendations are crucial for government revenues.

At present royalty, contributions towards district mineral foundation (DMF) and national mineral exploration trust (NMET) are all calculated on the basis of the monthly average sale price (ASP) of minerals published by Indian Bureau of Mines (IBM). ASP is computed based on the returns filed by the lessee of the merchant mines.

The new committee has the same task, as that of the Srivastava-led committee – to examine the double calculation of royalty due to inclusion of royalty in calculation of average sale price (ASP) and developing a NMI for valuation of mineral resources as well as to determine the value for auction of mineral concessions and statutory payments for future auction.

While the mines ministry did not furnish reasons for appointing a new head for the committee, Srivastava did not answer calls made by FE. Sources, however, said Srivastava excused himself as differences of opinion cropped up between him and some committee members with regard to the modus operandi for calculating ASP and double calculation of royalty.

These issues have a wider ramification since premium on the auctioned mines is payable on ASP as well as fixation of reserve price for auctioning of mines is also based on ASP.

The Kumar-led committee has sought comments from states, industry and other stakeholders on formulation of NMI for various minerals. Stakeholders have been asked to submit their recommendations by August 2.

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