ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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The ‘Common Good’ Has a Price

Mining in India sees monetary compensation as a substitute for the common good.


The National Democratic Alliance (NDA) government, since coming to power in 2014, has proactively pushed for increased involvement of the private sector in mining. Following the Coalgate scam under the previous government and the first come, first served (FCFS) policy of granting mining licences falling into disrepute, the current government pushed for an open auction process to grant mining licences. Further, policy and legislative measures strive to build momentum towards a favourable environment for private investment. The union government has already ­approved 100% foreign direct investment (FDI) through automatic route, in commercial coal mining, and mining of other minerals. The 2015 Mines and Minerals (Development and ­Regulation) (MMDR) Amendment Act further paved the way for this major shift in control and ­exploitation of mineral resources. While claiming to usher in a new era of transparency, it drastically altered existing practices, while continuing to ensure ­existing leaseholders benefit from concessions. With an impetus to open exploration to the private sector, the possibility of composite prospecting and mining licences was introduced. A National Mineral Exploration Trust (NMET) as well as District Mineral Foundation (DMF) were introduced as two bodies that sought to provide funding to two distinct aspects of mining—the actual act of ­discovering mineral resources (in the case of NMET) and to provide development funds for the welfare of the districts ­affected by mining (in the case of DMFs). With the ­National Mineral Policy 2019 providing a framework for mobilising all state resources to ensure ease of doing business, the Parliament recently passed the MMDR Amendment Act, 2021. While the legislation further exacerbates a deeper malaise in mining policy, it needs to be recognised for some drastic measures it includes. It ends the practice of further captive mining or end-use restrictions. For those captive mines already in place, it allows them to trade up to 50% of the output in the open ­market. Captive mining, especially in essential minerals such as coal, has been instrumental in fostering industrial growth, ­especially for the steel industry. Beyond the needs of industry, the discussion surrounding this legislation points at the deeper gaps that have consistently governed mineral policy in the country, and its roots in the social and ­political processes that define its history.

Mining is an extractive process and has severe environmental and social implications that last a long time, which is why the environmental impact assessment (EIA) and the rights of gram sabhas (village assemblies) for Fifth and Sixth Schedule Areas under the Panchayats (Extension to Scheduled Areas) Act are crucial. They ensure public accountability. However, the ­recent draft EIA notification 2020, which severely reduces the scope for public hearings and social audits, as well as permitting ex post facto clearances is a direct dilution of any semblance of institutional or public accountability. Any minimal, watered-down clearance also is deemed almost invalid ­under the new MMDR Act, 2021 which allows for transferability of all approvals and clearances, pending as well as following an ­auction. This has severe implications for liability and the legacy of mining in districts if such clearances are automatically transferred without examining the impacts after a cycle of mining. The claims of affected communities are now relegated to token hearings, and during the CoVID-19 pandemic this has meant quick online hearings, and in some cases, these have also been bypassed.

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Updated On : 10th Apr, 2021
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