Govt says 'no' to iron ore export ban

Govt says 'no' to iron ore export ban

Replying to a marathon debate in the Rajya Sabha on the rapidly growing illegal mining in the country–which brought a sharp focus on mining in Karnataka–Union Mines Minister B K Handique said states need to take stringent steps to stem the mining mafia.  
 “Merely because state governments are not able to prevent illegal mining, we should not ban export of iron ore,” he said.

The problem of illegal mining, which is growing in alarming proportion in Karnataka, Andhra Pradesh, Orissa and Jharkhand, is a problem of governance, he said.  
“We should see that there will be no illegal production of iron ore and strengthen the regulatory system with adequate staff”, he added.

The minister also clarified that Karnataka, the second largest producer of iron ore in the country, has not banned export of iron ore. “Karnataka has prohibited transportation of iron ore to ports and not export as such,” he said.

On the nationalisation of mines to check illegal mining, the minister said there are practical difficulties to nationalise the country’s mineral resources. “Nationalisation itself cannot put an end to illegal mining. There are practical difficulties,” he said.
Participating in the debate, Leader of the Opposition Arun Jaitley said those involved in illegal mining have permission for lawful mining. “On account of illegal mining there is large-scale tax evasion,” he said.

He said it is necessary to link the allotment of mines and minerals to the manufacturers rather than to the traders. Jaitley said that the government must fix a cap on the volume of minerals mined, so that there is sufficient deposit left for the future.

Pointing out that royalty and revenue to the state and central governments are dismal, he said, “There is a need to review and increase the volume of these taxes.” Responding to the members’ demand to increase royalty on iron ore, Handique said the rate of royalty is revised every three years and promised to have a relook into the matter.
Royalty rate on iron ore was revised to Rs 125 per tonne in 2009 from Rs 21 a tonne as a result state saw massive increase in royalty collection from
Rs 250 crore in 2008-09 to
Rs 4050 crore in 2009-10.

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