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Government to Raise Ore Production as Mining Revenue Declines

The major reason for the decline is attributed to the fall in average sale price of iron ore

Published: 14th January 2015 06:00 AM  |   Last Updated: 14th January 2015 04:07 AM   |  A+A-

BHUBANESWAR:With revenue collection from the mining sector declining in Odisha due to closure of large number of mines, the State Government is reported to have asked mining lease holders to increase production of iron ore.

Steel and Mines Secretary RK Sharma had a meeting with representatives of top 10 iron ore producing companies and five leading buyers of the mineral here on Monday.

The State had generated mining revenue of Rs 2,343 crore till October as against last year's collection in the corresponding period of Rs 3077 crore. The target of mining revenue for 2014-15 was Rs 6346 crore.

In 2013-14, revenue collection from the mining sector was Rs 5,500 crore against the target of Rs 6000 crore, official sources said.

With a cap on production and low dispatch of ore, the State Government may not reach the revenue collection target set for the current financial year even after revision in royalty from September last year.

The revenue collection was badly hit after the Supreme Court imposed restriction on operation of 26 mines. Meanwhile, the Government has issued express order for operation of eight mines.

As iron ore contributes 60 per cent of the mining revenue, fall in dispatch has affected collection.

The total dispatch of iron ore up to September, 2014 has been 22.32 million tonne (MT) as against 28.47 MT for the corresponding period in 2013-14.

The major reason for this decline is attributed to the fall in average sale price of iron ore. There are 36 iron mines presently operating in the State out of which 29 are non-captive. The State Government has also imposed a cap of 57 MT iron ore production in Joda and Koira circles in the State.

The meeting also discussed about proper reporting of sale price to the Indian Bureau of Mines (IBM), sources said.

A high level meeting chaired by Chief Secretary GC Pati recently reviewed the monthly production of iron ore and the demand and supply position of the mineral.

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