Mining Industry has supported 1/3rd population of hinterland of Goa for more than 50 years. With increase in prices in early 2000, the tons handled increased. Congress Government then introduced new controls such as stoppage of Karnataka Iron Ore transport through Goa for exportand no export without payment of royalty etc. But illegal trade kept on increasing. In 2012 when BJP Government came to power, it was thought to be a vote against mining administration by Congress. Surely Mining industry needed controls when it was still operating. BJP cancelled trading licenses of 420 trading and mining companies on the same day it came to power and only about 100 right lease holders could re-register. With this move the illegal traders got wiped off. But BJP Government then thought of controlling the mining industry further by suspension of all operations. The Freight on Board (FoB) price of low grade ore was around $100/ton at that time. Though it was an unprecedented move, there was hope that right mining companies will be able to restart mining again.
After lot of court battles in Goa and in Delhi, and after facing many expert committees, Government wanted to restart mining operations in the interest of all stakeholders. In 2015 finally mining industry was able to restart when FoB prices of low grade ore had dwindled to $30/ton. Today in 2018, there is no demand for low grade Iron ore from Goa and price of high grade ore is around $30 per ton and Supreme Court has cancelled the leases and as the operations have stopped on March 15, 2018, one does not see any hope of restarting of this major industry of Goa immediately.
Supreme Court wants environmental provisions to be adhered to legally and only work towards sustainable mining with state as primary beneficiary. Court also wants the State to auction leases as per provisions of amended MMDR Act and Court has said that Ministry of Environment needs to work on fresh environment clearances to new lease holders.
Following is a scenario we in Goa have to face due to Supreme Court judgement.
1. Based on exploration reports of Government agencies, State needs to work on a minimum value of lease and then declare the leases open for auctioning. After the auction decides new lease holders, they need to apply for fresh environmental clearances. Based on EC limit obtained, the new lease holders can re-start the mining operations.
2. In Karnataka, exploration of leases has taken more than a year. Auction process will take more than a year. The fresh environment clearance will take at least 2 years. All going well in perfect order, the new mining operations can restart only after 5 years. 88 leases in question have exploration certified so they will take only 4 years to restart.
3. Currently mining industry was operating at a level of approximately 15 million tons per year. The average price obtainable for 60 grade ore is $30 to $35 per ton. Which means Goa was earning approximately $45 million per month (on an average) which means foreign exchange revenue of approximately Rs 300 crore per month. All of this was getting distributed among its stakeholders such as State and Central Government, port, barge owners, truck owners, employees, machine operators, Panchayats, lease holders and all others who service these stakeholders.
4. Stoppage of this business especially after recent stoppage of 3 years will neither be acceptable to Government nor to other stakeholdersand dependents.
Given above facts, Government needs to find an interim solution such that Government adheres to the intent of Judgement of Supreme Court and the earning of all stakeholders (employees included) does not come to sudden halt.
Government has decided to go for review of the Judgment. Government will surely try to defend its decision to renew the leases. But should they fail to defend, they can clearly say that government will take at least 4 years to restart the mining operations in Goa by following the directives of the Supreme Court. There are few people who feel that government can auction the leases and restart in 6 months but the experience of auctioning of leases in Karnataka has shown that it takes more than 4 years to restart. For Goa, even if Supreme Court appoints a committee to oversee and speed up the processes, it will take minimum 3 years to restart the mining operations.
Supreme Court has had problems with legality of renewal of 88 leases. Out of all these leases, very few wereoperated till 15th March. Mining dependents and service providers who have lost their means of livelihood were working for such few mining leases. Until State Government works on auctioning and restarting of non-operating leases, if State can request and get Supreme Court to agree to maintain status quo for leases which operated till recently with their Environmental Clearance, there will be no distressed Mining dependent who are facing hopeless situation today.
