A committee of secretaries (CoS) has shot down Orissa government’s decision to cap the production of iron ore as suggested by the MB Shah Commission of Inquiry into illegal mining.
The commission’s report is likely to be considered by the Union Cabinet next week. The CoS has recommended that mines which are operating on expired clearances should be allowed to continue mining failing which there would be serious disruptions on availability of iron ore. The CoS, which met under the chairmanship of Cabinet Secretary Ajit Seth on January 18, deliberated to vet the Action Taken Report in response to the Shah Commission’s report on illegal mining in Orissa which allegedly led to a loss of around Rs 59,000 crore to the exchequer.
The inquiry panel in its five-volume report to the Centre had suggested banning export of iron ore or capping the output, refusal in case of mining leases not renewed within a year, CBI investigation into illegal mining in Joda iron ore mines among others.
Union mines ministry officials present in the meeting opposed Shah panel’s suggestion of capping the ore output to which the Orissa government has promptly agreed.
The Naveen Patnaik government has imposed a cap on production and dispatch of iron ore from Joda and Koira mining circles to 44 million tonne (MT) per annum and 13 MT respectively for 2013-14. Mines secretary RH Khwaja told the meeting that the cap on output is undesirable as proven reserves are not static and imposing a cap on the basis of reserves and resources identified at present “would not be in the interest of the country.”
The commerce ministry has already rejected the inquiry panel’s suggestion on banning iron ore exports as such a decision has to be “in the overall interest of the nation.” The CoS also opposed the Shah Commission’s suggestion that mines operating on expired clearances pending renewal of the concerned state should not be allowed to operate for more than a year. It argued that since renewal of clearances take unduly long time, the present dispensation of allowing the operating mines to continue functioning should not be discarded.