The Odisha government is considering electronic
auctions for iron ore mined in the state as resource-rich but
cash-starved states seek to increase their precious revenue to counter rampant illegal
mining.
A senior state government official told that such a proposal is being
considering but is at a preliminary stage. Odisha produces about a third of the
country's iron ore leading with players such as Tata Steel, Steel
Authority of India, Birla's Essel Mining, Adhunik Metaliks all owning mines
within the state.
In Odisha, only a little above 100 mines are operational out of its 600 leases
due to pending ongoing government investigations. This practice has
created a huge dent in the states' revenues as royalty on the ore comes to the
state's coffers.
In the next few days Odisha's senior officials will sit with
their Jharkhand counterparts to discuss measures to tackle illegal mining.
Odisha chief minister Naveen Patnaik has been a vocal critic of the paltry
royalty of 24-27 per tonne of iron ore until 2009, and 10% since. The state has
blamed the Indian Bureau of Mines of under reporting average iron ore pit
prices at pit mouth, based on the royalty that is collected.
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