Prakash Kamat
Panaji,February 27- In a series of consultations, the Ministry of Mines,Government of India has proposed a complete change in the way inherited mineral wealth would be managed, ignoring the National Mineral Policy 2019, and in violation of the rights of future generations, the right to equality and the constitutional structure of federalism,says Goa Foundation on Saturday.
The Gos-based green NGO lamented in a biting criticism,"The Government of India is now for reasons best known to it, willing to sell off the family silver at a massive discount."
Under the Constitution, sub-soil minerals are a shared inheritance, owned by State governments as trustees for the people and especially future generations. Mining is the sale and disposal of this inheritance, and the constitutional goal is zero loss in value during the financial transaction – any loss would violate the right to equality, said Dr. Claude Alvares, Director, Goa Foundation.
The proposed changes to the MMDR Act would essentially enable the Center to force States to sell their family silver at a below-market price that the Center sets. The proposed prices are vastly lower than the market price of the minerals – the royalty + auction premia on auctioned merchant leases.
This amounts to a grant of largesse to the beneficiaries, while cheating the state and future generations of their wealth. It also favors some miners over others.
"This is unconstitutional and an invitation to prolonged litigation. It’s also taking two steps backwards, after the law was changed to allow only auctions of mineral wealth," said Mr.Bose articulating the response of Goa Foundation. The NGO has been fighting legal battles for several years to protect the inter-generational equity in the mining sector if the State.
Further, the National Mineral Policy 2019 provides for a number of safeguards, including an inter-ministerial body including representatives of State governments to decide on aspects like whether we should sell our family silver, when we should sell it, and on what terms – royalties, etc. Without constituting this body, the Ministry has proposed specific conditions for sale of the family silver to be incorporated into the MMDR Act.
How would States then fulfill their duties as public trustees to conserve the shared inherited mineral wealth if they have no control over if, when or how they sell their family silver? How would states meet intergenerational equity? These proposals violate the principle of subsidiarity and the federal structure of our Constitution,warned the Goa Foundation.
The Supreme Court has already held that the grant of mining leases is a prerogative of State governments. How come the Central Government wants to usurp that power? Asks Goa Foundation.
Since minerals are our inherited wealth, and mining is the sale of this wealth, the sale consideration received in exchange for the minerals – royalties and auction premia – are capital receipts, just like the proceeds from divestments. Royalties and auction premia are not revenue. Are we addicts to sell off our family silver to consume the proceeds? Surely a strong nation is one that imports raw materials from others and exports finished goods, not one that is exporting its family silver for a song, remarked the green NGO.
Since minerals are our family silver, prudence requires a high security minerals supply chain to ensure no theft or loss of this wealth. Illegal mining is effectively theft of the family silver. In the financial sector, anyone who is of even slightly questionable antecedents would not be allowed to manage a bank or financial institution. However, it is distressing to find that there is no blacklisting of illegal miners either under the Mineral Auction Rules or the Insolvency and Bankruptcy Code, nor is illegal mining considered money laundering when minerals are clearly associated with our red corridor.
The Goa Foundation asserted that it is essential that fit and proper person tests and integrity due diligence be conducted on all participants in mining. In its absence, "we have thieves managing the family silver, with obvious results".
The NGO which has been fighting illegal mining in Goa for several years said that it was unfortunate to see that the Ministry has repeatedly violated the pre-legislative consultation policy and the Right to Information Act in formulating and announcing these proposals.
"And we are shocked to hear that of the 12,149 comments the Ministry received on the consultations on the draft MMDR amendments held in 2020, the Ministry has considered only those suggestions “which are committed for reforms in the sector.” Put simply, the Ministry only listens to those who agree with its increasingly backward-looking reforms,says Goa NGO.
The Goa Foundation has urged the State governments to urgently examine the consequences of these proposals on the federal structure of the Union, the constitutionality of these proposals especially in light of their role as public trustees over the shared inheritance of mineral wealth on behalf of the people and the future generations(eom).
