Goindocal: India’s Union Cabinet has in principle approved the proposal to introduce the Mines and Minerals (Development and Regulation) Bill (MMDR Bill), 2011, in terms of National Mineral Policy, 2008 in Parliament and also has approved the proposal to repeal the existing Mines and Minerals (Development and Regulation) Act , 1957.

Way back in 2006, the government had set the cat among the pigeons by constituting a high level committee which had strongly recommended for evolving a mining code in consonance with the current international practices for streamlining and simplifying procedures for grant of mineral concessions to minimize delays etc.

Based on the recommendations of the high powered committee constituted in 2006, the Government had finally declared its National Mineral Policy on March 13, 2008. After several rounds of deliberations with the stakeholders the Government has now finally been able to evolve a new Bill with the basic objective of implementing the policy directions.

The expectations with the proposed new Bill are quite high not only in the government circles but also among the concerned stakeholders.

The new MMDR Bill was initially forwarded to a Group of Ministers on June 14, 2010 after examining it thoroughly. After going through brain – storming five rounds of discussions and deliberations, it had finally recommended the draft Bill to the Cabinet. The Group of Ministers in its meeting concluded on July 7, 2011 had also finally recommended the draft MMDR Bill for being introduced in Parliament. This Bill was introduced in the Lok Sabha on December 12, 2011.

There is no doubt that this new MMDR Bill has been brought with the basic objective of introducing better legislative environment for the purpose of attracting more and more investment and technology into the mining sector.

As for instance, the States may call for applications in notified areas of known mineralization for prospecting based on technical knowledge, value addition, end – use proposed ore – linkage etc and to invite financial bid from among the available players in the market. Also, States are vested with the power of granting direct mining concessions through bidding based on a prospecting report and feasibility study. Gram Sabhas, District Councils or District Panchayats must be consulted before the notification of an area for mineral concessions.

The Bill empowers the Central government to invite competitive offers for grant of mineral concession in case of coal minerals, and similarly State governments to invite competitive offers in case of other minerals. State governments have the discretion to give preference to a cooperative of Scheduled Tribes in the grant of mineral concession in a Scheduled or tribal area.

It is also provided in the Bill that the State Government may set up a minimum floor price for competitive bidding. Special provisions have been made in the Bill for allowing mining of small deposits in cluster where cooperatives have the liberty to apply.

Bill also provides for imposition of a Central cess and a State cess and apart from this also postulates for setting up of Mineral Funds at National and State level for the purpose of capacity creation.

The holder of a mining lease shall pay either a yearly specified rent or a royalty in respect of every mineral removed or consumed by him, whichever is higher. It has also been envisaged in the Bill that there shall be creation of an amount which is equal to royalty in case of mineral other than coal, and 26% of net profits, in the case of coal for the basic objective of sharing the benefits of mining with local people. This has been proposed to be credited each year to District Level Mineral Foundation.

The Bill enjoins that firms must prepare a mining plan so that they could be permitted to carry out mining operations. It is also provided that the mining plan must include a corporate social responsibility document that contains a scheme for annual expenditure by the lessee on socio – economic causes for the benefit of the host population and for enabling self – employment opportunities. The Bill further makes it mandatory that every mining lease will have a Mine Closure Plan.

The new MMDR Bill certainly merits no elaboration that the approval will help in developing the nation’s mining sector to its full potential so as to put the nation’s mineral resources to best use for national economic growth, and ensure raw materials security in the long term national interest.                            

This Bill also provides for sustainable and scientific mining through provision for a Sustainable Development Framework.

It also provides for consultation with local community before notifying an area for grant of concession, and for approval of Mine Closure Plans. The Bill also lays down that mining companies shall allot at least one transferable share at par to each person of a family affected by mining related operations. It also makes the holder of a mining lease liable to provide employment in addition to other compensation payable to affected persons or families.

The Bill also contains provisions for establishment of Special Courts at the State level for speedier disposal pertaining to cases of illegal mining.

One hopes that it is made into a law soon by the government without any further delay now.