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(Thanks to Umashankar babu for the tip.)

Following is an excerpt from a report in the Wall Street Journal.

India’s federal government has approved an increase in mining royalties for various minerals including iron ore, copper, zinc and lead, government officials said Wednesday.

Two mining ministry officials, who didn’t want to be named, told Dow Jones Newswires that India’s cabinet committee on economic affairs has approved the proposal for changes in royalties on minerals other than coal, and a formal notification with immediate effect is expected this week.

…  The change in rates will increase states’ annual revenue from royalties to 46.3 billion rupees ($968.6 million) from 22.88 billion rupees.

… The officials said the government will levy a 10% value-added or ad valorem royalty on iron ore mining.

For iron ore miners, the new royalty will mean switching to a tax regime under which they will be charged based on the market value of the minerals compared with the existing system of flat rates based on weight, the officials said.

At present, the government charges a fixed royalty of up to 27 rupees a metric ton on different grades of iron ore.

Iron ore spot prices in the local market may rise by about 10% in the near future, … said Rahul Baldota, …  But he added that iron ore producers in India, the world’s third-largest supplier of the commodity, will absorb the cost for exports in order to remain competitive.

…  India already charges value-added royalty rates for zinc, copper and lead, but the rates charged will now increase.

The government will charge an 8% royalty on zinc ore, up from 6.6% earlier, while the rate on copper will rise to 4.2% from 3.2%. The royalty on lead ore will go up to 7% from 5%.

On bauxite used for other than alumina and aluminum extraction and exports, a royalty of 25% will be charged. For use in alumina and aluminum extraction, the rate will be 0.5%. Previously, no royalties were charged.

Economic Times has an article each on Jharkhand and Orissa’s mineral reserves and the current industrial climates and mineral policies of  both states. The two articles are:

• On Jharkhand.
• On Orissa.

Following are some additional comparison between both states:

• Orissa being a coastal state has coast related opportunities (ports) as well as problems (hurricanes, floods)
• Jharkhand has more larger metro areas than Orissa. Following are some population numbers.
  • Jharkhand’s top 4 metro areas are: Ranchi (1.07 m), Jamshedpur (1.25m), Dhanbad (1.21 m) and Bokaro (592k).
  • Asansol (West Bengal) with population of 1.3m borders Jharkhand (59km from Dhanbad) and together with Durgapur (544 K, 40 kms from Asansol) is being built as the second largest metro area of West Bengal.
  • Orissa’s top 4 metro areas are: Bhubaneswar-Cuttack metro (1.67m in Gazeteer, 1.9m in CPD estimate), Rourkela city (551K in gazeteer, 1.1 m unofficially estimated in metro area), Berhampur metro (514K in CPD estimate), and Sambalpur city (258K in Gazeteer).
• At present Orissa is a bigger knowledge and education hub.
• Orissa has more well known tourist locations.

Following is an excerpt from a report in Economic Times.

… The new structure will result in a 10% royalty payout on iron ore of all grades instead of the Rs 13-27 per tonne that states have been getting, depending on the quality of the ore. Revenue for states from the vital input for steel is likely to increase from Rs 250 crore to over Rs 1,500 crore per year.

“Higher royalty payments will certainly impact our expansion projects as lower realisations and even lower margins now leave little with the companies,” said an official of a leading private sector steel company.

The mines ministry estimated the total value of mineral production during 2008-09 at Rs 1.14 lakh crore. Orissa, Chhattisgarh, Jharkhand and Madhya Pradesh are India’s top mineral producing states and they have been pressing the Union government for about two years now to revise the royalty rates.

…Along with iron ore, the new system will lead to changed royalty rates for limestone, zinc, bauxite, manganese, diamond and uranium.

States’ royalty earnings on non-coal minerals are expected to double from level Rs 2,014 crore (at 2006-07 production levels) because of the new structure.

Royalty rates were last modified nearly five years ago and a change has been due since 2007.

Following is excerpted from a report in Business Standard.

Though Orissa has 183 million tonnes of chrome ore, constituting 98 per cent of the total chrome deposits in the country, only 3.27 per cent of this, which comes to about 6 million tonne, has been fully explored till date.

To expedite the exploration and exploitation of chrome reserves in the state, the government has granted mining leases to 15 companies including Ferro Alloys Corporation (Facor) and Balasore Alloys.

Of the total chrome reserves in Orissa, Sukinda area in Jajpur district has the lion’s share of 173 million tonne (mt). This includes low grade chrome.

The places in Sukinda where the chrome deposits are found are Kamarda (2 mt), Saruabili (9 mt), Sukrangi (7.5 mt), Kaliapani (25 mt), Bhimatanger (98 mt), Kalarangi (0.5 mt) and Chingudipal and Tailangi (13 mt).

Out of the total deposits found in Sukinda area, 18 million tonne are of inferior quality, says the state steel and mines minister, Raghunath Mohanty said.

The Kamakshyanagar in Dhenkanal district, which adjoins Sukinda valley, has about 4.42 million tonne reserve of chromite in locations like Sandhasar, Tulasiposhi, Haladigunda and Kathapal. The estimated reserves at Kathapal are 2 million tonne.

Mohanty said, the total chromite reserve of the state is estimated at 183 million tonne, out of which 177.42 million tonne occur in Sukinda and Kamakshyanagar area.

Following is an excerpt from a report in Economic Times.

As regards Orissa projects, where 80% of the employees are from the state, we have resolved not to go for any layoff. In fact, we are appointing more and more people in our projects here,” Vedanta Group chairman Anil Agarwal told reporters here on Saturday on the sidelines of his first meeting with Orissa chief minister Naveen Patnaik after the latter swept the just concluded polls.

Mr Agarwal claimed that Vedanta had already invested Rs 25,000 crore of its promised Rs 50,000 crore investment in the state. “The rest will be spent in the next two years”, he assured.

Meanwhile, the VAL had secured Stage I clearance for mining of bauxite in Niyamgiri hills to feed its Lanjigarh project. …

Mr Agarwal also stated that Vedanta had got coal block for its Jharsuguda smelter project and it will soon start coal mining. To a query on the University project, Mr Agarwal said: “We are going to start our university project very soon.”

Mr Agarwal hoped that the state government would soon pass the Vedanta University Bill in the Assembly. “We have already submitted all papers to the state government required for passing of the Vedanta University Bill. I hope it will be passed in the House shortly,” he added.

He informed that Anil Agarwal Foundation – which is setting up a world class university at Puri that includes a 1000-bed hospital – will have its extended centre in Bhubaneswar. “During the meeting, the CM was contemplating if we have can have an extended centre of our hospital project in Bhubaneswar to set up a trauma centre for burn and coma patients. We have in fact agreed for it,” he said.

Following is from a report in Business Standard.

The joint venture (JV) Company formed between the state owned Orissa Mining Corporation (OMC) and Sterlite Industries India Ltd (SIIL) for mining of bauxite in the Niyamagiri hills in Kalahandi district will be incorporated as a Private Limited Company soon.

.. “The draft memorandum of association (MoA) and Articles of Association (AoA) of the new company has been submitted to OMC for approval. The incorporation of the JV company will be completed shortly after the approval”, P K Panda, vice-president (mines), Vedanta Aluminium Ltd.(VAL) told Business Standard.

The process of incorporation of the Joint Venture company named as “South-West Orissa Bauxite Mining Private Ltd.” has been set in motion after the signing of the modified JV agreement between SIIL and OMC in February this year, paving the way for start of bauxite mining in Niyamgiri hills near Lanjigarh.

Meanwhile, the special purpose vehicle (SPV) namely ‘Lanjigarh Scheduled Area Foundation’ has already been formed and SIIL has deposited Rs 20 crore up to 2008-09 with the SPV for overseeing the all-round development in the Lanjigarh area.

Supreme Court in its judgement on 8 August 2008 cleared mining of bauxite in the Niyamgiri hills located in the Kalahandi district by SIIL following affidavits filed by SIIL, OMC and Orissa government accepting the rehabilitation package suggested by it on 23 November 2007.

While the company has deposited Rs 12 crore for tribal development, another Rs 10 crore is proposed to be deposited with the SPV during 2009-10. As part of its plan for the overall development of the area, the company also intends to provide connectivity to all the villages of Dongria Kandh, which are remotely located.

This is in line with the 5-year development plan drawn up for these villages by the Dongria Kandh Development Authority (DKDA).

Regarding the JV agreement of Vedanta Aluminium Limited (VAL) with OMC for getting the raw material linkage, the apex court had stated that since Vedanta Resources Plc is not an indian company, it will not have any objection if the its indian subsidiary (SIIL) is made the JV partner of OMC.All provisions of the supreme court judgement were incorporated in the modified JV agreement signed by OMC and SIIL

It may be noted, VAL, a Sterlite group company, signed the JV agreement with the OMC on 5 October 2004, for developing bauxite mines at the Niyamgiri hill near Lanjigarh in Kalahandi district and the Khambasi hill in the adjoining Rayagada district. The bauxite was to be used for use in its one million tonne alumina refinery at Lanjigarh.

Following is an excerpt from a report in tathya.in.

… Mr.Agarwal impressed upon the Chief Minister that his group is eager to expand the .50 million ton smelter in Jharsuguda to a 1.6 million ton per annum (MTPA). 

Naveen Patnaik, asked the Chief Secretary to look into the matter finalize the expansion program, said sources. 

Mr.Agarwal updated the Chief Minister about the status of Vedanta’s ongoing projects in the state here on 3 January..

The Alumina Project at Lanjigarh, Smelter and Power Projects at Jharsuguda and the University project at Puri is being implemented by the Vedanta group.

On Corporate Social Responsibility (CSR) front, adoption of 400 anganwadis, providing education for 14000 children at Kalahandi are being implemented, briefed Mr.Agarwal.

Mr. Agarwal agreed to extend the coverage to 40000 children and agreed to introduce the Mid Day Meal scheme for 30000 primary and the secondary level school student in the state through Nandi and Sterlite Foundation as the Chief Minister requested him.

He also announced a 100 bedded state-of-the-art multi-speciality hospital at Jharsuguda will provide medical facility to the local people.

Chairman Vedanta group reiterated his earlier commitment to build a 1000 bedded super-specialty hospital at Puri.

It was also informed that the design and the engineering has been completed and construction is to begin soon.

In addition Mr Agarwal put forth his plans of setting up of a downstream Aluminium Park in collaboration with the government to promote as many as 600 small and medium scale industries at Jharsuguda. 

The project will generate large scale employment opportunities and additional economic activities in the region.

Currently the Vedanta Group’s investment commitments are in excess of Rs 50,000 crores, half of which has already been invested in various projects of Orissa.

Vedanta is presently generating a huge number of direct and indirect employment for approximately 25000 people, eighty percent of which belong to the state of Orissa.

After the meeting the CM, Mr Agarwal told reporters that all the ongoing projects of Vedanta would continue as per schedule in spite of the recent global recession.

He also assured that in his personal capacity he would make all possible efforts to complete the Vedanta University Project, a world class University at par with the Havard and Stanford University of U,S.A.

He has already committed personal contribution of Rs 5000 crore towards this project.

Following is from http://pib.nic.in/release/release.asp?relid=46319.

The CCEA has approved the revision of the rates of royalty for uranium as per recommendations of the Study Group. Accordingly, royalty rates for Uranium would be levied on ad-valorem basis on the basis of compensation amount paid to the Uranium Corporation of India Limited (UCIL), at the rate of 2% of the compensation amount received by the UCIL, to be apportioned on state wise basis as per the details provided by the Department of Atomic Energy.

The Government has taken several initiatives to streamline exploration and mining of mineral Uranium in the country. One of the issues pertained to providing a fair compensation tot he State Governments for the mineral mined out from their territory. While the Government is working out a proposal for revision of royalty rates for all minerals, a considered decision has been taken to enhance the royalty rates of mineral Uranium immediately, keeping the fact in view that uranium is a strategic mineral and mining operations in this sector is restricted to Public Sector only. Royalty on minerals is payable to the State Governments by a holder of a mining lease in respect of any mineral removed or consumed by him from the leased area.

In terms of the provisions of the Mines and Minerals (Development and Regulation) Act, 1957, the rates of royalty can not be enhanced more than once in a period of three years. The existing rates of royalty for minerals including Uranium, other than minor minerals, coal, lignite of royalty for Uranium can be enhanced any-time after 14.10.2007.

In order to review the rates of royalty and dead rent the Government constituted a Study Group under the Chairmanship of the Additional Secretary (Mines) with the representatives of the State Governments of Chhattisgarh, Jharkhand, Karnataka, Orissa, Rajasthan, Ministry of Steel, Department of Atomic Energy, Indian Bureau of Mines, and the Federation of Indian Mineral Industries as members. The Study Group noted that the details on domestic production and domestic pricing of uranium are not available in public domain. Further the mining operations of uranium are exclusively done by public sector, with limited captive use. Thus for the sake of transparency, the Study Group recommended that the compensation paid by the Government to the public sector undertakings involved in mining and processing of uranium, would be used as the reference point for determining royalty payable to the State Governments.

*****

AD/SH/LV

Following is an excerpt from a report in Steelguru.

…the provision that allows the Centre to intervene in disposing of a company’s application for mineral concessions in case the State does not take a decision in the prescribed time limit is being done away with. This provision was one of the reform recommendations made by the high level committee set up under Mr Anwarul Hoda member of Planning Commission for the mining sector with the objective to woo big investments.

Officials in the Ministry of Mines said that the Indian government has not agreed to the Hoda Committee recommendation on this issue. Officials said that “Constitutionally, State Governments are the owners of all mineral resources in their region. Mineral rich States had opposed the proposal and the Centre has agreed with them.”

Chief Ministers of Orissa, Jharkhand, Chhattisgarh, Madhya Pradesh and Rajasthan in December 2007 had submitted a joint memorandum to the Prime Minister opposing the power given to the Centre in the draft National Mineral Policy. The chief ministers said that “This approach is fundamentally flawed in so far as bulk minerals like iron ore, bauxite, chromite, limestone, dolomite and manganese are concerned.”

Following is an excerpt from a report in the Statesman.

The state government today inked an MoU with RSB Metaltech for setting up of an integrated light metal aluminum complex. The papers were signed by state industries and mines secretary Dr Ashok Dalwai and RSB Metaltech MD Mr SK Behera …

In the first phase, the proposed company, with an investment of around Rs 6,800 crore, will produce about 7 lakh tonnes per of alumina. In the second phase, nearly 1.75 lakh tonnes of aluminium is expected to be produced from the plant. The produced aluminium will be used for production of finer parts in motor vehicles, aerospace, railway and construction industry.

While the mining and refinery units of the project will come up a Rayagada, the smelter unit and power plant are proposed to be set up at Kamakshyanagar in Dhenkanal.

Chief minister Mr Naveen Patnaik said that the project will generate about 11,000 direct and the equal number of indirect jobs. "This project, along with its alumina refinery at Rayagada and Gopalpur port will form an industrial corridor in southern Orissa," Mr Patnaik said adding that the corridor will help fast development, alleviation of poverty and improvement of life of the local people in that region. He suggested that provisions should be made to provide technical education to local youths. "The rehabilitation, resettlement and environment aspect should be taken proper care of," he pointed out.

The Union minister has been requited to expedite and complete the "Therubali-Gunupur railway project to enhance the connectivity in that region," he informed.

I wonder about the progress of the earlier plan of establishing an auto component manufacturing plant near Cuttack by RSB Transmission. (See  http://www.orissalinks.com/orissagrowth/archives/421.)

The following article in Samaja lists the bauxite deposits in Orissa. There is a total of 1.25953 Billion ton of bauxite in Orissa in 13 different locations. They are:

1. Panchapatamali, Koraput – 16 sq km area having 310 million ton
2. Gandhamardan – 230 million ton
3. Bafilamali – 195.73 million ton
4. Kodingamali – 91.4 million ton
5. Sajamali – 86 million ton
6. Sasubohumali – 81 million ton
7. Pattangi -75.12 million ton
8. Kalarapat – 59 million ton
9. Lanjigarh – 53 million ton
10. Krutimali –  40 million ton
11. Karnapathikonda –  17.12 million ton
12. Balada – 12.4 million ton
13. Mali mountain – 9.5 million ton

See http://orissagov.nic.in/e-magazine/Orissareview/dec-2007/engpdf/28-31.pdf for an older article on this.

Following are excerpts from a report in livemint.com. (The article seems to be written from the point of view of miners. Nevertheless, if mining activities can help build infrastructure in this area then it may be worth looking. As always, a big worry is the potential impact of mining activities on the environment.)

… Experts say the soil beneath the farming fields in Kandhamal is mineral-rich. The state government has received several applications for mining leases over the last 18 months—potentially leading to investment, jobs and infrastructure—but red tape has stymied progress.

“There is bauxite, graphite, iron ore, gold and coal in Kandhamal,” says G.C. Prusty, senior surveyor at the local mining and steel office in the district. “But nothing is happening. Company representatives keep coming here and ask me about the status of their application. I just tell them to wait for the state government’s approval. I am also waiting.”

… Panda speculates that now the state is so busy pursuing big mines of lucrative minerals such as coal, iron ore and chromite in the more obvious districts of Rayagada and Jajpur that it does not have the bandwidth or the will to explore smaller deposits in areas such as Kandhamal.

… But more than ever before, clearing these small leases, so that new jobs can be created in Kandhamal, has become critical, amid the simmering Kandha-Pano conflict. Security experts believe that if this conflict is left unresolved, the district with its thick jungles and disaffected people is likely to become a haven for Maoist guerillas.

“If their economic problems are left unheeded, then these people are likely to become sympathizers of the Maoists,” says A.N. Sinha, deputy commissioner of police in Cuttack, who has served three years in Gajapati, a district of Orissa that borders southern Kandhamal. Maoists are active in Gajapati.

… And if policy improves, investors say they will come to this district, despite the recent conflict. “Conflict will not keep mining companies out. I would certainly be interested in going there,” says Panda of Imfa.

…

“We generate employment. We employ locals at our mines in Jajpur and Rayagada; we employ them for dispatches, bringing in equipment. Then there is a multiplier effect. Other jobs come up with a mine,” Panda says.

To win over locals, companies also undertake social projects; Imfa reports spending 2% of its net profit (approximately Rs412 crore every year) to set up health and veterinary camps and to build hospitals and schools in Orissa.

Locals, too, say they would welcome the mining companies. Asthik Digal, a Pano who is a stone-breaker and migrates to earn daily wages of Rs200, says he would rather work in a place close to his family. “If I get a job here, why will I go so far from my wife and children? I will stay here and work in a mine,” he says.

But right now, the idea of industries, schools and hospitals in Kandhamal seems like a distant dream, says Prusty.

He may be right. Because even though there is a lot of investment coming into the state—Orissa has signed about 50 preliminary agreements worth about Rs1.98 trillion to set up steel plants—the government’s mining policy is deficient, by many accounts.

To begin with, the state has not updated its mineral map (map of all the resources in the state) in 30 years.

…

“We have no idea of what resources we have or if the ones we do have are mature enough to sustain such large-scale exploitation,” says Shantanu Mohapatra, former director of mines in Orissa. Panda agrees. “So far, we have looked only for the most obvious minerals such as iron ore and bauxite in the most obvious places. Places such as Kandhamal have not been investigated closely.”

When winds changed and mining became lucrative, companies seized the opportunity and forced the state to play catch-up.

The government’s inability to reshape its mining policy has prevented it from earning revenue and also hampered jobs from being created in Kandhamal, where both Kandhas and Panos could have benefited from the rising global demand for the minerals lying beneath their lands.

… Observers say that if the government had acted in time and channelled investment here, maybe the conflict, which is essentially an economic battle between two of India’s most deprived groups, would have been avoided.

They say a long-term economic plan is essential to stop the violence in Kandhamal. That won’t start, residents say, until the government allows them to mine the benefits of their mineral wealth.

Following is from a report in Steelguru.com.

… to augment the availability of iron ore, particularly in the context of number steel plants being proposed to come up in the state, the Orissa government plans to intensify exploration of iron ore at different locations of mineral rich Sundergarh and Keonjhar districts to identify new reserves.

The exploration work be taken up during the current year include the northern part of the Baliapahar iron ore deposits and Mandajorha area in Sundergarh district and outer Malangatoli area of Keonjhar district.

The directorate of geology of the Orissa government has decided to take up assessment of the iron ore lying in the northern part of Baliapahar iron ore deposit in the Sundergarh district. It will delineate the unexplored iron ore bodies in this area through survey and large scale mapping and then take up assessment of reserves through drilling.

Though this area was investigated earlier in 2 phases in 1971-74 and 1991-95 through mapping and core drilling, the drilling of the northern part was not complete. It has also been decided to go for preliminary appraisal of the iron ore occurrences to the west of Malangtoli and north-eastern part of the Mandajorha area.

As per report, this area was identified as the unexplored block during the last field season through inventory work. It is proposed to take up investigation of the area around Malungi and Mandajoraha during the current field season.

Sources added that there are plans to continue and complete the investigation program in the unexplored blocks in the Koira sector of the Sundergarh district for iron ore reserves. Geological mapping around Lasi, Jilkura, Marchidihi is proposed to be taken up during the current field season. Similarly, the government also plans to start the investigation of the iron ore around Rakma-Marsuan in outer Malangtoli area in Keonjhar district.

Sources further added that geological mapping and sampling will be taken up to locate iron ore bodies in this area which was prospected by the Geological Survey of India in the 1960s. Since the area is located in the vicinity of Bonai shoe iron ore synclinorium and very close to Malangtoli iron ore complex, the government feels that geological investigation will be beneficial from the point of view of exploration.

In http://www.orissalinks.com/orissagrowth/archives/1616 we discussed a report regarding auctioning of minerals. The following article in Sambada illusrtates with numbers that the best way to go would be to decide the winner of the auction based on evaluating the financial and technical bid together and determining which one offers the state the maximum revenue. (Later when time permits I will translate the article into English.)

The following excerpts from a news item from tathya.in illustrates the difference between the state’s income due to only royalties and through auction.

In 2002 the IDCOL made an abortive attempt to give away the mines to Jindal Stainless at a throw away considerations ignoring higher bids by Tata Steel and Visa Industries.

The ill-conceived move by the bureaucrats was foiled by the Orissa High Court, which passed adverse comments regarding the Government of Orissa attempt to compromise public interest in the deal.

Both the State Government and IDCOL appealed before the apex court to get relief with considerable cost and time.

Supreme Court’s order for re-bidding how ever has now materialized.

To the amazement of every one Jindal Stainless which had offered a sum of Rs.38 per ton has now come up with a bid of Rs.3000 per ton for ore having 48 per cent chromium.

And on average they have offered per ton Rs.900.

Visa Industries has out bid Jindal Stainless with an offer of Rs.7000 per ton of chrome having 48 per cent of chromium content.

Even assuming the changes in the commodity prices which have taken place in last 5 years is too much than the price offered earlier.

The colossal loss to the flagship Public Sector Undertaking (PSU), IDCOL can be well imagined if the Jindal Stainless had succeeded in 2002.

Now with opening the financial bids of the participants, it underscores the point that the State Government’s Policy for leasing out the mineral resources of the state is faulty and not at all in the best interest of the state, said a financial analyst.

To take the advantage of high price in demand of metals and minerals in the international market, corporate giants and multinationals like POSCO, Arcelor- Mittal, Essar, Vedanta, Jindal, Bhusan and many others are flocking to Orissa to corner mining leases.

The State Government  … Yet they do not learn from the Tangarpada experience.

… Under the MMDR Act, mines can be reserved for the PSUs and leased out to the State owned companies like IDCOL and OMC.

These PSU can auction the mines among the credible parties after floating world tender for value addition and derive bonanza.

Till date no body knows about the “Policy of Value Addition” of the Government of Orissa.

The Policy should come up immediately and it should be implemented in letter and spirit for the interest of the state.

The positive changes of Policy will not effect industrialization, but it will give substantially higher rate of revenue to the state exchequer as demonstrated in case of Tangarpada.

The state’s entire requirement of funds for eradicating poverty and developing the state can be generated with the policy change, said a former Union Minister.

However there is no effort in this direction.

…  Instead of Centre bashing the State Government should make efforts to maximize revenue from mineral resources through PSU mode, observed a former Secretary of the Government of India.

Definitely the state can earn much more on just the minerals by leasing it to state companies like OMC and IDCOL and then letting those companies auction the mineral. The possible negative of completely following that approach, especially with respect to iron ore, is that the winner of the auction can then take the ore and set up plants in other states. If that happens Orissa will lose out on the side developments associated with plants such as infrastructure building, jobs and the tax that the state can get from the companies.

What the state should do is to try for the best of both worlds. I.e., offer other facilities and enticements to keep the companies in the state but go the route of auction. What other facilities and enticements can the state offer?  Orissa being on the coast, availability of ports nearby is an important factor and it is good that the state is working on the development of many ports and railway lines to those ports. Easy availability of land for the companies will help. More thoughts need to be put in this direction.

There is a chance that some companies will not set up shop in Orissa under these conditions; but these days there seems to be a lot of companies who want to set shop. So perhaps the time has come for the state to change its approach of leasing mines to attract companies to auctioning minerals via IDCOL and OMC and using other methods to attract value addition companies.

Following is an excerpt from a report in Pioneer.

The Gitanjali Group, one of the oldest leading names in gems and jewellery, has proposed to set up a Special Economic Zone (SEZ) in the State. The group’s infrastructure arm, Gitanjali Infratech Limited (GIL), has approached Chief Minister Naveen Patnaik to set up its eighth SEZ for gems and jewellery.

The company’s chief executive officer Ajit A Vaidya has requested the State Government to allocate land for the purpose. If allowed, it will be the first of its kind in the State, said an officer of the Industries Department. The Gitanjali Group is known for its jewellery brands, Nakshatra, Gili, Desire, Asmi, Sangini and D’dmas in both domestic and international markets. GIL’s existing seven SEZs are spread over Maharashtra, Andhra Pradesh and West Bengal.

While the gross size of the Indian gem and jewellery industry is 20,889.21 million dollars, the country’s jewellery manufacturing is currently only a fraction thereof.

This is predominantly due to lack of availability of organised infrastructure, structured manufacturing and exporting environment, said Vaidya.

Therefore, setting up of more SEZs for this sector would promote export of the Indian products, he said.

The gems and jewellery sector, which is labour-intensive, currently generates more than 3 million jobs with the setting up of SEZs.

As there are more than 2 lakh workers from Orissa engaged in the diamond cutting and polishing industry in Surat, this will help them find jobs in their homeland, feels a senior official.

Following is an excerpt from a report in Pragativadi.

Jindal Steel and Power Ltd is optimistic about commissioning the first phase of the proposed six MTPA steel mill in Orissa’s Angul district by October 2010.

… Briefing newsmen after the meeting, Jindal said that the work for the first phase of the project was progressing well.

The company had already spent Rs 4,000 crore so far for it and has placed an order for equipment for the purpose.

Of its total project cost of Rs 13,135 crore, JSPL had also spent a lot on land, construction, equipment and other activities, he said.

Jindal said JSPL has a small iron ore mine at Tensa in Keonjhar district and is hopeful of getting raw material linkage to its Angul project. 

We have been allotted coal block for the requirement of our captive power plant and the steel plant, he added.

He said that the company apprised the chief minister about the progress and made a presentation before him, while seeking the state government’s help in availing new raw material linkage early.

The JSPL which signed an MoU with the state government for setting up a beneficiation plant at Deojhar in Keonjhar district and the Angul steel plant on November 11, 2005, had progressed well besides tackling local problems, he said.

Following is an excerpt from a report in Pragativadi.

The Supreme Court on Friday cleared the decks for Anil Agarwal promoted Vedanta Resources to mine bauxite from the ecologically fragile Niyamgiri hills for its proposed Rs 4,000-crore alumina project at Lanjigarh in Kalahandi district.

Vedanta had sought clearance for diversion of 660.749 hectare of forest land for mining purposes to feed its alumina plant.

The special forest bench comprising Chief Justice K G Balakrishnan, Justices Arijit Pasayat and SH Kapadia allowed Sterlite to go ahead with bauxite mining.

The application of Vedanta is allowed, the Supreme Court bench said in a statement. 

However, it asked the ministry of environment and forest to proceed in accordance with law.

… Vedanta wants to dig open-cast mines in the Niyamgiri hills located in Kalahandi district near its project area. 

Vedanta promoted Sterlite Industries had sought clearance for diversion of 660.749 hectares of forest land for mining purposes to provide required raw material for its plant.

Following is an excerpt from a report in Pragativadi.

The Supreme Court on Friday permitted South Korean steel major Posco to set up Rs 51,000-crore mega steel plant and captive minor port at Paradip in Jagatsinghpur district.

A special environmental bench headed by Chief Justice K G Balakrishnan allowed Posco India Pvt Ltd, a subsidiary of South Korea-based Posco, to go ahead with its plans.

With this order, the apex court has also cleared forest diversion proposal for the plant site which require 1253.225 hectares of forest land.

The court, while directing the Orissa government to dispose of all the Posco’s applications seeking prospecting licences within four weeks, also asked the state government to send its recommendations to the ministry of environment and forests that would proceed in accordance with law.

The bench also asked the state government to undertake implementation of compensatory afforestation plan under the supervision of a Supreme Court-appointed committee comprising top officials of the state government.

… Posco counsel Mukul Rohtagi contended that the state government-owned Orissa Mining Corporation had agreed to supply uninterrupted iron ore and other minerals for its steel project and had identified mines in the western part of the state, some 300 km away from its project site.

… The company can source raw materials on its own and can buy the same from the open market, he said, adding that the company is not dependent on prospecting licence.

Following is an excerpt from a report in the Statesman.

Vedanta Aluminium Ltd (VAL) offers the best rehabilitation package in the state, claimed company sources here recently. The company aims to reduce the impact of its activities on the environment, wherever feasible. The majority of the sites are certified by the international environmental management systems standard ISO 14001. This includes the requirement that environmental impacts are identified. There are ongoing programmes for improvement across key impact areas, they said.

Responding to the critics of its bauxite mining project at Kalahandi, Vedanta officials said that all 120 families that were displaced for the project have got pucca houses with round-the-clock electricity and water supply. Besides one youth from each displaced family has been trained and given a job in the refinery, adding that a total of 2,500 local people have found employment in the refinery project till date. “While about 2000 people had got direct employment at the refinery in Lanjigarh, over 2000 others were getting indirect income generating opportunities,” company sources said.

Vedanta has also started the ‘Sasya Silpa Abhijan’ an initiative of vegetable cultivation, run in collaboration with the Asian Institute of Sustainable Development to give a boost to agriculture in the area. “On an area of 550 acres of land, nearly 500 farmers are participating in the project as partners,” said a senior official. “Although we bear the expenses for irrigation through a diesel pump set by us, yet the training and support provided by Vedanta through this programme has helped us a lot,” said Mr Dinanath Pangi, a farmer.

Vedanta also offers various self-employment schemes for residents of the villages nearby and especially for the womenfolk. Women self-help-groups have been started under public-private partnership in collaboration with the district health department on the Swastha Parivar project. In a bid to widen its corporate social responsibility, the Vedanta group has also adopted 400 Anganwadi centres in Kalahandi district and will look after more than 40,000 children in some of the state’s most backward areas.

“Vedanta has signed an MoU with the state government and the Sterlite Foundation for the adoptions,” said Vedanta group spokesman Mr CV Krishnan. “As a part of the arrangement, every pre-school child aged between three and six years will be provided a cooked meal of 300 calories at noon. The company will also look after the health of the children through regular check ups and medicines,” he added.

He further said that the company is also undertaking the beautification of the Anganwadis by erecting green boundaries, whitewashing buildings and providing see-saws and slides for the children. Furthermore incentives are being provided to Anganwadi workers. While Anganwadi workers receive Rs 250 per month, each helper is given Rs 150 extra by the company. “The same exercise will also be replicated in Jharsuguda,” Mr Krishnan said. The total expenditure on child welfare activities in the two districts will be over Rs 15 crore, company officials revealed In order to ensure that everything goes as per plan, the process will be reviewed by a committee headed by the district collector, the local MLA and the chairman of panchayat samity, they said.

Mr Krishnan said that Vedanta further aims to improve the electricity network, construct roads and develop better educational and healthcare facilities.

Following is excerpted from a report in Pragativadi.

According to a preliminary estimation made by the Directorate of Geology, nearly 8 million tonnes (MT) of bauxite was reserved at Ushabali plateau in Kandhmal district. Estimation regarding bauxite reserve in Kandhamal district is preliminary. The volume of reserve could be more, an official said, adding survey work would be extended to nearby areas this year.

The Orissa Mining Corporation (OMC) recently reviewed the mineral survey activities taken up the Directorate of Geology to find new reserve, particularly iron ore, which was in demand as the state had signed MoU for setting up of at least 46 steel plants.

The Directorate had completed survey of Hirapur area in Nabarangpur district for iron ore deposits and had also undertaken fresh surveys in Joda, Badbil in Keonjhar and Daitari in Jajpur.

Though the directorate had completed iron ore survey work by using drilling method at Tensa area of Sundargarh district, the findings were under study, sources said.

Similarly, the survey had also concluded that small diamond reserve could be traced at Dharamabandha and Nangalbod area of Nuapada district where the precious metal was found along with stones.

Following is an excerpt from a report in Business Standard.

Aditya Birla Group, one of the largest business houses of the country having interests in sectors like aluminium, telecom, cement, textiles, fertiliser, mining, retail, finance and insurance plans to invest about Rs 75,000 – 80,000 crore in Orissa.

The proposed amount will be invested in sectors like aluminium,cement, telecom and retail sectors in the state over next few years.

… Birla, who was here to discuss some project related issues with the Orissa Chief Minister Naveen Patnaik said, the company also intends to launch its retail business in Orissa as part of its national roll out plan. It will be launched within the next 6 months.

… Stating that the projects are proceeding well, he said, the company is committed to a lot of social work like setting up ITIs and health centres at the project sites.

… Regarding the resistance of the local people to the alumina refinery project Utkal Alumina at Raygada, the group chairman said, a lot of projects are facing the same problem. The company has sought the state government’s intervention in resolving the issue.

He said, ABG took over the company four years ago from Alcan Inc and the company has complied with the rehabilitation and resettlemnet (R& R) package given to it. He, however, was non-commital about any additional package for the project affected people.

" We can not commit on the new package. As long as there is reasonable settlement we will be happy", he pointed out.

Regarding the possibility of investing in the port sector of the state, Birla said, the company is persuing the matter with the Orissa government and is expecting a positive outcome.

It may be noted, Essel Mining, a group company of the ABG had earlier proposed the state government to set up a port at Chudamani. However, the state government had not accepted its proposal.

The major projects of the group in Orissa include Utkal Alumina refinery at Raygada, Hindalco’s alumina smelter and power plant at Sambalpur and 3.5 million tonne per annum cement plant in Sundergarh district.