Yearender: Mining sector witnesses high-voltage developments

Alleged illegal mining occupied centre stage in Karnataka politics for most part of the year and at one point of time even threatened to topple the Yeddyurappa government.

There were allegations that the B S Yeddyurappa-led government was protecting state cabinet members G Janardhana Reddy and G Karunakara Reddy, whose Obulapuram Mining Company was accused of indulging in illegal mining.

The furore over the issue forced the state government in July to order a probe by Lokayukta into illegal mining from 2000 till July 2010 and a ban was imposed on issuing permits to transport iron ore and other minerals for exports.

As per official estimates, Karnataka is estimated to have about 11 per cent (over 9,000 million tonnes) of the country's iron ore reserves, which are mainly concentrated in the Bellary-Hospet area.

An official of the Mines Ministry said that "the iron ore prices have gone up by about 90 per cent to USD 120-160 a tonne during the last one year on rising demand for the mineral from the steel industry, which is luring people for illegal mining activities."

The issue even kept politicians busy for some time at the national level and the Centre constituted a one man inquiry commission in November, headed by former Supreme Court judge M B Shah to probe the issue. Shah has been asked to submit his findings in 18 months.

For the record, about 42,000 cases of illegal mining were detected in 11-mineral bearing states in 2009. Of this, the government suspended mining activities in 483 mines, mining lease in 38 cases were cancelled and as many as 948 mines were closed.

Realising that there were not enough legal provisions to tackle the issue, Union Mines Ministry also added a provision in the new mining bill, which states that anyone found guilty of illegal mining will be debarred from doing it anywhere in the country. It also proposed to reward whistle-blowers on illegal mining.

The new Mines and Mineral Development and Regulation Bill proposing 26 per cent profit sharing for displaced people due to mining activities had the industry debating the formula threadbare.

Finance Minister Pranab Mukherjee-led ministerial panel cleared it early this month and now it will be placed before the Cabinet for the final approval.