Is Karnataka Govt Killing the Golden Egg Laying Goose (NMDC Donimalai Iron Ore Mine) ?

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NMDC (National Mineral Development Corporation) Ltd had suspended its Iron Ore Mining at DIOM (Donimalai Iron Ore Mine) since 4th November 2018, as an 80 % premium would have an adverse effect on its revenue.

NMDC Ltd's DIOM had been in operation since October 1977, whose 50 years lease got expired on 3rd November 2018. The Karnataka Government has approved the mining lease of Donimalai Iron Ore Mine till 3rd November 2038 for 20 years, on payment of 80% of the average sale value as published by IBM (Indian Bureau of Mines).

Mining Companies are already paying 15 % for Royalty, 20 % for SPV, 4.5 % D.M.F. (District Mineral Foundation) and 0.5 % NMET (National Mineral Exploration Trust).
For NMDC the levy is not economically viable. It is estimated that NMDC would be losing Rs 1,348 per Ton, due to which its annual losses would stand at about Rs 9.44 Billion. Donimalai Mine’s capacity is about 7 Million Tons.

The decision (to impose an 80% premium) was the prerogative of the State Government. "As per the Auction Regime Act, 2015, the Government cannot levy any premium on the existing mines, however, it can do so on new/renewed mine leases.”

NMDC Ltd has filed a case in the Hon'ble High Court of Karnataka against Karnataka Government for claiming the larger share of revenue from the sale of Iron Ore from the Donimalai Mine in the State. The main reason the company moved the petition was the State's decision to fix 80 % premium.

The Questions arising on the decision of Karnataka Government are:-

1. Whether it considers Ministry of Steel, Government of India’s Premier Navaratna PSU NMDC Ltd. same as other private Mining Companies?
2. Whether it is aware of the services rendered to the Nation by the Single Largest Eco-Friendly Iron Ore Miner to the Nation, the Exploration Master of India, The 'Only 5-Star' Rated Iron Ore Mine Under Sustainable Development Framework (SDF) in Karnataka?
3. Whether it is aware of NMDC’s record of CSR activities, R&R plan, SDF designs?
4. Whether it is eyeing to hand over Mines to private Mining Companies (including JSW) ?
5. Whether it has assessed the social, economic & industrial impact on NMDC’s stake holders at micro to macro level?
6. Has the State Government assessed the hardships being faced by the casual labourers and their family members daily with each passing day, and livelihood of employees, their family members, dependants, customers, since the day of suspension of the Iron Ore Mining and production?
7. Whether imposing premium of 80% on iron ore sales from the Mine is really worth even considering logically when no company makes such a margin - not just Indian, not even global companies?!  Is it merely a black-mailing tactic of the State Government to get benefit from Private Companies (including JSW) by favouring them at the cost of profit making PSUs like NMDC ?
8. क्या राज्य सरकार अति लोभ व तात्कालिक लाभ के वशीभूत होकर प्रतिदिन सोने का अंडा देने वाली मुर्गी को हलाल करना चाहती है ?
9. क्या राज्य सरकार की संकीर्ण सोच एक राष्ट्रीय संपदा और उद्यम की गरिमा के साथ एक भद्दा मजाक नहीं है ?
10. क्या राज्य सरकार द्वारा एक राष्ट्रीय सार्वजनिक उद्यम के साथ इस तरह का बर्ताव राज्य-केंद्र संबंध का खामियाजा तो नहीं है ?
11. क्या यह घटना संघीय ढांचे को कमजोर नहीं करता है ?
All Indian citizens are requested to join hands to convey message to the Government of Karnataka to withdraw the blatantly illogical, unethical and unrealistic imposition of an additional 80% premium on NMDC !


// Jai DIOM, Jai NMDC, Jai Karnataka, Jai Hind //