COUNTING THE COST OF MINING AND QUARRYING

THE below-the-radar mines and minerals industry is back in the news.

- GURBIR SINGH

A full bench of the Supreme Court has ruled the states have the right to levy taxes on mining operations, overturning an earlier 1989 verdict which had held only the Union government had the power to impose such royalties.

The court has made the ruling retrospective from 2005, opening up a Pandora's box of fresh costs for mining companies. Some estimates put the combined hit at over 2 lakh crore.

Mineral-rich states like Odhisa and Jharkhand will celebrate a new source of revenue, while mining companies will tear their hair reworking their costs. But where is environmental sustainability in all these calculations?

The Union and state governments, as custodians of lakhs of acres of forest and public land, have been ramping up mining operations for coal, iron ore, lignite and limestone to serve the rising demand for power, steel and cement.

It was a therefore a bold assertion by the Prime Minister in his Independence Day speech that India is ahead of all G20 nations on Climate Action and for achieving its renewable energy targets by 2030. Seen in the context of destruction of the environment by increasing mining operations, this claim sounded alittle hollow.

Destroying communities

India's mining sector grew 7.5 per cent in FY24, with production of iron ore and limestone recording high growth during the year. Production of iron ore was at 277 million metric tonne (MMT) in 2023-24 against 258 MMT in 2022-23, registering a growth of 7.4 per cent.