New Delhi: Paving the way for auction of iron ore and other mines, Parliament today cleared the Mines and Minerals Bill after days of high drama, as some Opposition parties broke ranks from Congress and Left in Rajya Sabha to support this key reform measure of the government.
States are likely to launch the auction process in June for allocation of mines, having iron ore and other minerals, following the passage of this Bill, which has incorporated amendments suggested by a parliamentary panel, would now replace an Ordinance promulgated in December last.
Finance Minister Arun Jaitley said that the new law would enable "computerised allocation" of the mines, while checking corruption and any discriminatory allocation systems, while Steel and Mines Minister Narendra Singh Tomar said it would bring in a "revolutionary change" in the beleaguered sector.
The estimated revenue proceeds could not be immediately ascertained for the auction, for which states have so far identified over 100 mines, containing as many as 10 minerals like iron ore, bauxite and others, for the first phase. In all, 199 mines have been identified so far.
The Mines and Minerals (Development and Regulation) Amendment Bill, 2015, was passed by the Rajya Sabha earlier in the day with 117 members voting in favour and 69 against it. Later it was approved by the Lok Sabha within 20 minutes.
Industry bodies, including CII, FICCI and Assocham said the new law will bring transparency in auctioning of mines, boost investor sentiment and kick-start industrial growth.
The Bill envisages spending a fixed percentage of revenue generated from mining on the development of the local area.
As per its provisions, there will be no renewal of any mining concession, unlike the original act of 1957. Also, the licence will be for 50 years, as against 30 now, after which there will be no renewal but compulsory auction.
The bill was cleared by the Lok Sabha earlier also but was referred to a Select Committee in Rajya Sabha by a united Opposition. After a day of high drama yesterday, the Bill was cleared by the upper house today as the government agreed to the amendments recommended by Select Committee on March 18.
These amendments provide for existing lease holders to pay 100 per cent of royalty towards district mineral foundation (DMF) while those who will get mines after the new legislation will have to pay up to one-third of the royalty.
"The Mines and Minerals (Development and Regulation) Amendment Bill, 2015, will bring in a revolutionary change in the sector. It will attract more investment, enhance expertise and income of those employed with the sector," Steel and Mines Minister Narendra Singh Tomar told PTI.
While hailing the passage of the Bill, industry body FIMI said higher payment for development for the project affected persons mandated in the Bill would inflate cost of production which would be felt by end-users and the general public alike.