Centre may allow states to decide on mining royalty

The central government is considering a proposal to confer the right of revising the rate of royalty on minerals to the concerned states, minister of mines and minister of development of northeastern region B K Handique stated in a written reply in the Lok Sabha.

State governments are the owners of the minerals lying within the boundary of the concerned state, although prior approval of the central government is required in case of minerals specified under the first schedule of the Mines and Minerals (Development & Regulation) Act, 1957 (MMDR) before grant of mineral concessions, a minister stated.

As per section 5(2) (a) of the MMDR Act, no mining lease shall be granted in respect of a major mineral by the state government unless a mining plan for the area under mining lease has been approved by either Indian Bureau of Mines (IBM), a subordinate office under the administrative control of the ministry of mines or the state government concerned, Handique noted.

The mining plan inter-alia includes the extent of manual mining, use of machinery and mechanical devices and plan for excavation. Also, under Rule 45 of the Mineral Conservation and Development Rules, 1988, the leaseholder is required to submit returns regarding production, dispatch and stock from the leasehold area to IBM for monitoring by them.

Under the provisions of the Mines & Minerals (Development & Regulation) Act, 1957 (MMDR), the central government cannot enhance the rate of royalty in respect of any mineral more than once during any period of three years.

Royalty rates for minerals (other than coal & lignite, minor mineral) were last revised on 14 October 2004 and next revision of royalty rates was possible only after 13 October 2007.