Spare mines from axe for technical faults: Assocham

The Supreme Court should ask the Central Empowered Committee (CEC) to undertake a detailed review of iron ore mining leases so that those engaged in legal mining were allowed to continue operations, the chamber said.

The CEC was appointed by the apex court to submit a report on alleged illegal mining activities in Bellary district. While observing in its report that large-scale illegal mining was taking place in Bellary, the committee favoured a complete ban on mining. On the basis of this report, the Supreme Court banned mining by 19 companies.

The court will take up on Friday whether the ban should be extended to another 68 companies.

Mining should be moved from unorganised to organised sector if it was to be done in a legal, scientific and environment-friendly manner, Assocham said while appreciating the Supreme Court’s decision to suspend leases granted to 19 entities.

However, if the court were  to suspend the licences of another 68 mines, the industry would be left with only four to five mines, said Assocham Secretary-General D S Rawat.

“The daily supply from four to five mines will not exceed 20,000 tons against the requirement of one lakh tons. As a result, the entire industry in the region will come to a grinding halt within two or three days and closure will become inevitable,” he said.

“The CEC has suggested banning of all mining activities even on the basis of some technical violations,” Rawat said. The best solution to the problem was to segregate technical violations from illegal mining in the CEC’s report.

Mines guilty of technical violations had to be given time to rectify the flaws. If they did not within a stipulated period, they could be closed. “Illegal mining should be banned outright,” Rawat suggested.

“There is apprehension that in case a conclusion is arrived at by the apex committee without studying individual agreements and makes a prima facie determination of illegality, it could result in wrongful closure of many mines,” he said.

Steel, iron and other industries had invested Rs 62,000 crore in the landlocked Bellary-Hospet region as it had abundant iron ore deposits, the chamber said. The state finances would also suffer as these industries paid about Rs 10,000 crore a year in excise duty, royalty and value added tax.

In view the ‘huge’ investment, workforce of ‘lakhs’ and dependency of industries on iron ore, Assocham pleaded for uninterrupted availability of iron ore lumps and fines to meet industrial requirement while framing policies.