Coal Ministry goes against contributing 26% profit to local area

Thursday, March 24,

The coal ministry has objected an offer to make it compulsory for mining firms to contribute a segment of their profits towards local area development, saying it will eat away valuation of firms and reduce investor sentiment.* 

Last year, the ministry of mines had proposed an amendment to the Mines and Minerals Development and Regulation Act to make it mandatory for mining companies to deposit 26% of net profit or royalty, whichever is higher, in the district mineral foundation fund, from which people affected by projects will be compensated.