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Bhubaneswar, Feb 6: The Bhubaneswar Chapter of Federation of Indian Chambers of Commerce and Industry has requested the state government to urge the Centre to formulate a regulatory framework, if required through an ordinance, to allow the non-operational iron ore mines to restart operations under a deferred penalty payment mechanism.
“We have requested the state government to go lenient on closed mines so that they resume working and repay compensation in instalments. The 56 mines that received statutory clearances for operation were able to pay compensation as they were in operation,” Manish Kharbanda, Executive Director, Jindal Steel and Power Limited, said at a one-day seminar on ‘Odisha Mining Industry-The Way Forward’ Tuesday. He said restarting closed mines will strengthen people who are unemployed as a result.
While reminding the gathering that the deadline to achieve targets for 2020 was approaching, he said any decision on mining should be taken by the last quarter of this year. “Iron ore production will fall if the government does not intervene. And it will affect the steel industry the most. G2 level drilling has already fallen greatly. The state government can discuss all these issues with the central government and take proactive measures to solve problems miners are facing at the earliest,” Kharbanda said.
Principal secretary, mines, R K Sharma in turn said the state will adhere to the Supreme Court decision and continue to collect penalties to the tune of `10,000 crore against `17,576 crore from mine leaseholders for illegal mining.
He said: “Miners will not be affected by closure of a few mines because in the past they have successfully handled more problematic situations when large numbers of mines closed down.”
He said miners have to comply with all provisions of law to do business smoothly. To overcome legal hurdles, miners can file curative petitions before the Supreme Court. “As mines are a central government subject, state governments can do little on many things and so miners should approach the appropriate forum,” he said.
The meeting resolved that there was a shortfall of about 25 MTPA of iron ore in the state, which is likely to go up further as the installed capacity utilisation of the state-based steel industries increases.
“[Increased installed capacity utilisation] has resulted in a steep increase of iron ore prices in the state (59 per cent in last 2 months and approximately 100 per cent increase in last 6 months). This price rise has driven input costs of the state-based steel industries to unviable levels,” FICCI added.
Owing to the closure of seven mines, there has been a shortfall in dispatch of 18 million tonnes of iron ore, which has resulted in an annual loss of revenue amounting to `900 crore towards royalty. Ficci said 1 lakh direct and 2.5 lakh indirect jobs were lost in the state.
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