Odisha govt, opposition welcome hike in mineral royalty

Reported by Chinmaya Dehury
Bhubaneswar, Aug 21:

Welcoming the Union government’s decision to hike royalty on minerals, Odisha steel and mines minister Prafulla Mallick today said the state expects to garner around Rs 2,000 crore additional revenue per year as a result of the raise.

“Though the revision of royalty should have been done in 2012, we welcome the Centre’s decision. We expect to garner additional revenue of around Rs 2,000 cores per year, which will accelerate the growth of state,” said Mallick.

He said the government would also urge the Centre to clear arrears of Rs 4,000 crore due to non-revision of royalty rates, which was due since August 2012.

The BJP and Congress also welcomed the decision of central government.

Leader of Opposition Narasingha Mishra said the state could have got much more for its exchequer long back if it had accepted the proposal of the party to impose tax on the miners. He, however, did concede that increase in mienral royalty would help nurture growth in the state.

BJP leader Sajjan Sharma said the state had got more than its expectation. “From Day 1 of BJP’s regime at the Centre, the government has been fulfilling Odisha’s demand one by one,” said Sharma.

The revision of royalty on minerals was a long standing demand of the Odisha government. It was demanding 20% royalty on minerals. During his first meeting with Prime Minister Narendra Modi, chief minister Naveen Patnaik had raised the issue stating that the state was losing approximately Rs 5 crore per day (assuming the present level of production and approval of the revised rates of royalty suggested by the Study Group).

The Union cabinet on Wednesday gave its approval to raise the royalty rates on minerals, including iron ore and bauxite, a long awaited move that will boost the annual revenue of mineral bearing states.

While the royalty rates for coal and lignite have not been raised, taking note of the apprehensions of the state electricity boards that this could raise the cost of power generation, the royalty was raised on 23 of the 51 minerals whose rates can be decided by the central government.

The royalty rate for manganese ore was raised from 4.2 per cent to 5 per cent, while for iron ore and chromite it was raised from 10 per cent to 15 per cent. Bauxite rates were raised from 0.5 per cent to 0.6 per cent.

The last time the rates of royalty were revised on August 13, 2009 and the next revision was due since August 13, 2012.