Poor Despite ₹5,800 Crore

Plan and plan well is the message from the first independent evaluation of India's ambitious resource-sharing plan for mining districts

- Srestha Banerjee

IN 2015, the Union government amended the Mines and Minerals (Development and Regulation) Act, 1957, to set up a District Mineral Foundation (DMF) in every mining district of the country. The idea was to create a mechanism to share mining revenue for the benefit of mining-affected people in these districts. Two years on, the DMF coffers are flush with funds, but have the people benefitted?

To understand this, Delhi-based non-profit Centre for Science and Environment (CSE) undertook the country’s first independent evaluation of DMFS. The evaluation covered 50 big mining districts in 11 states. The results show that money has started to flow in and some districts are putting it to good use, but a majority of the districts are still lagging.

The Act mandates that DMFS, to be established as non-profit trusts, should “work for the interest and benefit of persons and areas affected by mining related operations”. The mining companies are required to pay a sum—determined on the basis of their royalty payments—to the DMF trust of the district. For all major minerals (such as coal and iron ore), the contribution is 10 per cent of the royalty paid to the state government for mining leases granted on or after January 12, 2015, and 30 per cent of the royalty for leases before that. For minor minerals (such as sand and stones), the payments are decided by the states.

The Union government also launched Pradhan Mantri Khanij Kshetra Kalyan Yojana (PMKKKY) in September 2015 to implement developmental projects and welfare programmes in mining-affected areas using funds generated by DMFS. The scheme seeks to negate the adverse impacts of mining on people and the environment, and create sustainable livelihood opportunities for those affected by mining activities.