Supreme Court appointed panel is likely to recommend that 11.4 million tonne of mined iron ore in Goa to be auctioned. The auction will be overseen by a monitoring committee. The Central Empowered Committee reporting to the apex court on forest matters wants a Karnataka like model imposed on Goas iron ore industry which has been idled ever since a inquiry commission claimed irregularities to the tune of INR 35,000 crore. In a major relief to the primarily export oriented iron ore industry of the west coast state, the CEC has not recommended a ban on exports. The E auction of mineral resources was first introduced in the country after the Supreme Court recommended the process of transparently allocating resources to user industries in the state of Karnataka. The change was brought about after allegations of large scale illegal mining in Karnataka that led to the arrest of a former minister there and a change in the state government. In Karnataka, the miners were asked to work on reclamation and rehabilitation of forest and are now required to set up individual infrastructure, mandatory provision of space for dumps. The production of iron ore has now been capped at 30 million tonne. One of the bigger issues in Goa has been the inability of the state miners comparatively small mines to accommodate rejects or dumps. Auctioning iron ore is however not acceptable to Goas miners which include Vedanta Resources Sesa Goa, Fomento Resources, the Salgaocar brothers and the Chowgule group. They have always maintained that there is no domestic buyer for Goas low grade iron ore which has been traditionally exported to Japanese steel mills and later largely to Chinese mills. Mr Swaminathan Sridhar, Executive Director of the Goa Mineral Ore Exporters Association said that Exports are long term contracts. Goan miners are traders, why should they buy ore at an auction to export it again. That wont make sense. In August Mr Manohar Parrikar CM of Goa in an interview to ET strongly objected to any monitoring of the mining industry and decried the attempt to hand over the function to anybody other than the state a move he described as infringing on his constitutional rights as Chief Minister. Goa, at one point contributed to 21% of the countrys total iron ore production before the ban was imposed, exporting 43 million tonne in 2011 to 12. The interim stay on mining activities imposed almost a year ago, initially by the state government and then by the Supreme Court on October 5th last year has significantly impacted state revenues to the tune of 25%. A prolonged period of no mining while companies get meet new requirements as imposed in Karnataka, could further impact state revenues.
Posted on: Sat, 02 Nov 2013 04:31:31 +0000
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