BHUBANESWAR: Union Finance Minister Arun Jaitley’s announcement for timely revision of royalty on minerals has come as a huge relief to the State.
With falling revenue from the mining sector, the State Government has been demanding for revision in the rates of royalty to the Centre.
Though the rates of royalty of major minerals excluding coal, lignite and sand are to be revised every three years, the Centre is sitting over the matter for nearly five years. The last revision was made in August, 2009.
“There have been requests from several State Governments to revise rate of royalty on minerals. Members are aware that rate of royalty can be revised after a period of three years. Last revision took place in August, 2009. Therefore, another revision, which is due, will be undertaken to ensure greater revenue to the State Governments,” Jaitely announced while presenting the Union Budget.
A study group constituted by the Central government on revision of rates of royalty and dead rent had submitted its report in June 2013.
Based on the recommendations of a study group, the Mines Ministry had recently floated a Draft Cabinet Note on increasing royalty on minerals like iron aore and bauxite for inter-ministerial discussion.
However, the matter is still pending with the Centre for issue of notification, official sources said.
Because of delay in notification of revision of royalty rate, the State is losing approximately `5 crore per day assuming the present level of production and approval of the revised rates of royalty suggested by the study group, the sources said.
Worried over inordinate delay in the revision of rates of royalty on minerals and dead rent collected on mining leases, Chief Minister Naveen Patnaik had written several times to the UPA Government requesting to notify the revised rates.
In the year ending March 2015, the State aims to generate `6,346.98 crore revenue from the mining sector, higher than `5,515 cr collected in the last year.
In 2013-14, the revenue collection from the mining sector had fallen by 3.11 per cent from `5,695.70 crore collected in 2012-13 to `5,515 crore despite higher output of iron ore.
According to sources in the Steel and Mines Department, the State had produced nearly 78 million tonnes of iron ore in 2013-14 as against 64 million tonnes produced in 2012-13.