Miners to pay 10 per cent royalty to tribal welfare

NEW DELHI: The Centre will on Wednesday notify the Pradhan Mantri Khanij Kshetra Kalyan Yojana, which would make it mandatory for all mining companies to contribute 10 per cent-30 per cent of royalty for welfare of tribals and other affected persons in mining areas. The move comes within a month of Prime Minister Narendra Modi's promise of Rs 6,000 crore for development of tribals in mining-affected areas in his Independence Day speech.

Each district where mining activity is initiated will have to set up a District Mineral Foundation (DMF)under the district magistrate or district collector. This foundation would identify people affected by mining activities and works that should be undertaken for their welfare.

Under the scheme, in case of all mining leases executed before January 12, 2015, miners would have to contribute an amount equal to 30 per cent of the royalty payable to the DMFs. Where mining leases are granted after January 12, 2015, the rate of contribution would be 10 per cent of the royalty. The scheme would be implemented by DMFs.

Mines secretary Balvinder Kumar told ET: "Almost all states have set up DMFs. They were waiting for clarity from the Centre on the percentage payable to DMFs. Now the scheme is finalised and after the notification, the states would frame their rules." Guidelines being notified by the Ministry of Mines have specifically laid down the heads under which the funds need to be utilised to ensure the affected tribals get the benefit of the schemes. At least 60 per cent of the funds under PMKKKY have to be used for high priority areas such as schools, primary health care centres, women and child development, drinking water supply, environment preservation and pollution control measures. Up to 40 per cent funds can be used for infrastructure projects such as physical infrastructure, irrigation, energy and watershed development and any other measures for enhancing environment quality in mining districts.

The ministry expects to get Rs 6,000 crore under PMKKKY. Kumar said, "the total royalty for major minerals is Rs 20,000 crore".