(a) whether the Government proposes to provide 26% equity in mining entities to the
affected people where excavation of minerals takes place;
(b) if so, the details thereof;
(c) whether concerns have been raised over providing shareholding rights to the affected
people; and
(d) if so, the details thereof?
THE MINISTER OF MINES AND MINISTER OF DEVELOPMENT OF NORTH EASTERN REGION
(SHRI B. K. HANDIQUE)
(a) and (b) : In the draft Mines and Minerals (Development and Regulation) Act, 2010,
hosted on the website of Ministry of Mines on 3rd June 2010, it was proposed that twenty six
percent of profits after tax (PAT) would be required to be distributed by the mining lease
holders to the persons affected by mining related operations and in case of mining companies,
through grant of twenty six percent free equity to the affected persons.
(c) and (d) : Concerns were raised by the Industry that :
(i) the profits that should be taken for the purpose of sharing with local population
should pertain to mining operations and not to profits earned from downstream value addition
activities,
(ii) administrative difficulties are likely in identifying the affected persons in existing
mining leases areas and distributing the profits directly to them,
(iii) direct distribution of profits to the affected persons may lead to disparities due to
varying population densities, nature of mineral and efficiency of mining operations.
The Government has considered these concerns and suitably modified the provisions in the draft
Act.