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CSE bats for sharing benefit provisions in draft mine bill

Staff Reporter

BHUBANESWAR: New Delhi-based Centre for Science and Environment here on Friday claimed that provision of sharing benefit in the draft Mines and Minerals (Development and Regulation) bill, 2010 (MMDR bill), which was vetted by Group of Ministers, would have come as succour to mining-affected impoverished people.

The CSE which held a day-long consultation attended by members civil society groups, State's bureaucracy and media claimed mining industry's opposition to the proposal to sharing of benefits with local communities had no basis while statistics proved that sharing profits would not dent the industry's profitability

It is to be noted that mining companies and industry in general had been opposing the government's recent proposal to set aside 26 per cent of their net profits, to be shared with local communities. Their contention is that this provision, if passed by Parliament, would drastically dent their profitability.

Huge profits

According to CSE the Indian mining sector enjoys huge profits. “An analysis of the annual reports of three major non-coal mining companies (Manganese Ores India Ltd, Sesa Goa and National Mineral Development Corporation or NMDC) indicates that in 2009-10, their average profit after tax (PAT) was about 50 per cent of their turnovers. In the case of Coal India Limited, this was about 18 per cent,” the environmental pressure group says.

It researched book titled “Sharing the Wealth of Minerals” says assuming the draft MMDR Act, 2010 becomes a law, it would not make any material difference to the profitability of the company.

“After sharing 26 per cent of the net profit with the affected community, the PAT of National Mineral Development Corporation – for instance -- will still be 41 per cent of its turnover (from 55 per cent). In the case of Coal India Limited, PAT will become 14 per cent of its turnover from 18 per cent,” CSE says here.

As far as Orissa is concerned, the mining-affected people would have got about Rs.1,750 crore as share of profit from mining companies that could have been used to reduce hunger, provide better health and education infrastructure and to ultimately bring people out of poverty.

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