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Rs 1150cr windfall in mines bill - Hemant, others welcome profit-sharing clause

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  • Published 6.08.11

Ranchi, Aug. 5: Nine districts of Jharkhand will have an annual earning of over Rs 1,151 crore with the local population reaping most of the benefits if a 26 per cent profit sharing clause under a draft Mines and Mineral (Development and Regulation) Bill 2011, to be tabled in Parliament in the monsoon session, comes through.

A report released by Delhi-based research and advocacy organisation, Centre for Science and Environment (CSE), here in Ranchi today, suggested that if the draft bill was implemented, then the affected population of 50 major mining districts of the country could get more than Rs 9,000 crore as share of profits from mining companies.

The share of Jharkhand’s nine mining districts — Dhanbad, Hazaribagh, West Singhbhum, Chatra, Godda, Bokaro, Ranchi, Palamau and Deoghar — would be to the tune of Rs 1,150 crore as per the 2010-11 figures, vis-à-vis profits earned by various mining companies.

Per capita income estimates for these districts, which account for 6.41 lakh people effected by mining, would be around Rs 18,000 as a share of profits from mining firms.

Industry majors in general, and mining companies in particular, have been opposing the government’s proposal to set aside 26 per cent of net profits for sharing with local communities.

Their contention is that if the provision was passed by Parliament, it would seriously dent profitability. However, CSE’s recent analysis proves them wrong, suggesting instead only a marginal drop in profits of the companies.

CSE deputy director general Chandra Bhushan said, “This money should be used not only to reduce present impoverishment but also for future well being of the communities like investment in health and education. There is huge opposition to this bill and it may get axed. But it is very important for the communities that this bill goes through.”

Deputy chief minister Hemant Soren, who also holds the mines portfolio, while releasing the CSE report, strongly recommended a 26 per cent profit sharing by the companies.

“This is strange that in majority of mine-bearing districts, the local population is by and large poor. They are also being subjected to environmental degradation and ill-effects of pollution caused due to mining,” he said.

Principal secretary in the drinking water and sanitation department Sudhir Prasad also welcomed the profit sharing clause in the bill.

Bhushan added that it was a recognised fact across the world, and in India, that wealth generated by the mining sector came at a substantial development cost, along with environmental damages and economic exclusion of the marginalised.

“In fact, the major mining districts of India are among its poorest and most polluted,” he added.


District-wise value of minerals mined with projected share of profits ( 2010-11) as per provisions of the draft bill in parenthesis

1.       Dhanbad: Rs 3,760 cr (Rs 396 cr)

2.       Hazaribagh: Rs 1,895 cr (Rs 200 cr)

3.       West Singhbhum: Rs 1,195 cr (Rs 126 cr)

4.       Chatra: Rs 1,083 cr (Rs 114 cr)

5.       Godda: Rs 1,041 cr (Rs 110 cr)

6.       Bokaro: Rs 953 cr (Rs 100 cr)

7.       Ranchi: Rs 541 cr (Rs 57 cr)

8.       Palamau: Rs 250 cr (Rs 26 cr)

9.       Deoghar: Rs 201 cr (Rs 21 cr)

Total: Rs 10,921 cr (Rs 1,151 cr)