BHUBANESWAR: With state governments developing cold feet about auctioning of explored non-coal mineral blocks post Covid-19 pandemic, the Centre has proposed to tweak the rules to take over state’s power to conduct auction where the going is getting tough.
Proposing further amendment in the Mines and Minerals (Development and Regulation) Act, 1957, the Ministry of Mines has justified the move of taking over the auction of minerals from the state governments to maintain a seamless supply of minerals for metal-based industries.“It is proposed to provide the power to Central government to conduct the auction in cases where the states face challenges or fails to conduct the auction,” said a note on supplementary for amendment of MMDR Act.
“In cases where the Central government auctions the blocks, the revenue in respect of such blocks will accrue to the state government only,” the Ministry assured.The Ministry felt the necessity to go for further reforms as only seven out of 143 mineral blocks, geological reports which have been handed over to the states by Central exploration agencies since 2015, have been auctioned.
Even as mining leases of 334 blocks expired on March 31, 2020, of which 46 were working mines, only 28 blocks have been auctioned. This is despite constant hammering of the Centre to the mineral bearing states to go for early auction of these blocks ensuring continuity in the production of minerals so as to maintain the demand-supply chain.
Odisha topped the list having 166 mines whose leases have lapsed. The State government has granted leases to 745 mines out of which only 166 are working while 122 mines are non-working mines. Operation of 114 mines have been discontinued temporarily.After the amendment of the MMDR Act in 2015, 103 mineral blocks were auctioned in the country out of which 31 were from Odisha.
While the first quarter of the current fiscal was a complete wash-out due to the pandemic, sources in the mining sector said the State government is not keen to go for auction of its mines out of apprehension that the bids may not get good response since a majority of the earlier auctioned mines are yet to be made operational due to various issues.
The Ministry justified changes in the auction rules stating “to ensure continuous supply of minerals in the country more number of mineral blocks are required to be brought under auction on regular basis.” Any delay in auction will have substantial impact on the availability as well as prices of minerals, the note said.