Wednesday, May 11,
Strong opposition from mining companies have forced Government to rework on the controversial profit-sharing clause in the proposed mining Bill.* The profit will be aligned with the value of minerals instead of levying a uniform rate, to lessen the burden on a few mining companies.
The Mines and Minerals (Development and Regulations) Bill is being debated by a group of ministers to decide on new provisions, including the much-talked about clause on allocating 26% of the profits generated, in favour of persons displaced by the mining project.
Prices of iron ore and coal, two vital inputs in steelmaking, have seen a robust rise in the recent past due to growing demand for the alloy. However, the mining industry has opposed efforts to incorporate the clause on top of royalties, cess, and other local taxes it was already paying. The opposition was on grounds that there is no clarity on how at the profit are calculated, as most listed companies has mining divisions and the final profit is a consolidated number.
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