Steel Re-Rolling Mills Association of India · 2015. 2. 9. · [39th Issue Steel Re Rolling Mills Association of India visit Page 4 SRMA STEEL NEWSLETTER SRMA Steel Re Rolling Mills

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SRMA STEEL NEWSLETTER

SRMA

Steel Re Rolling Mills Association of India

www.sram.co.in

Steel Re-Rolling Mills Association of India www.srma.co.in Email : [email protected]

Sl. No, Name

1. Shri B.M. Beriwala, Chairman

2. Shri Jagmel Singh Matharoo, Vice Chairman

3. Shri Ramesh Kumar Jain, Treasurer

4. Shri Sanjay Jain Committee Member

5. Shri Kailash Goyal “

6. Shri Om Prakash Agarwala “

7. Shri Sushil Sharda “

8. Shri Sandip Agarwal “

9. Shri S S Sanganeria “

10. Shri Sanjay Surekha “

11. Shri R P Agarwal “

12. Shri S S Bagaria “

13. Shri Girish Agarwal “

14. Shri Goutam Khanna “

15. Shri Suresh Bansal “

16. Shri Rajiv Jajodia

“

17. Shri Bhusan Agarwal

“

18. Shri Mahesh Agarwal

“

19.

Shri Sita Ram Gupta “

20. Shri G P Agarwal

“

21. Shri Suresh Goyal

“

22.

Shri Hari Mohan Beriwala “

23. Shri Sitaram Agarwal “

24. Shri Sonal Mittal

“

25. Shri Avinash Bagla

“

26. Shri Shankar Lal Agarwal

“

27. Shri Sandip Gupta

“

28. Shri Dilip Agarwal

Special Invitee

29. Shri Vivek Adukia

Special Invitee

http://www.srma.co.in/

mailto:[email protected]



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Disclaimer :

SRMA Steel News is a division of Steel Re-Rolling Mills Association of India and takes due care in preparing this

news. Information has been obtained by SRMA from sources, which it considers authentic. However, SRMA does

not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or

omissions or for the results obtained from the use of such information. SRMA is not liable for investment decisions,

which may be based on the views expressed in the News. SRMA especially states that it has no financial liability

whatsoever to the subscribers/users/transmitters/distributors of this News. And no part of this news may be

published /reproduced in any form without SRMA’s prior written approval.

Executive Summary

Indian Steel Industry : Past ,Present & Future

Environment & Safety

Taxation/Legal (Circular/Notification)

Events

Latest Steel News

CONTENTS



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Slowdown in the economy, Central Statistics Office (CSO) proved what most projections had

done so far, that Q4 2013-14 growth would be below the 5 per cent mark as would do the year-

end numbers. Thus CSO reports showed that GDP at factor cost at constant (2004-05) prices in

2013-14 was at Rs. 57.42 lakh crore, recoding a growth rate of 4.7 per cent, only a few notches

above the revised 4.5 per cent growth rate of 2012-13.

2013-14 was also the year when the Indian steel industry emerged as a net exported of total

finished steel, after a long hiatus of being a net importer (since 2007-08) and despite the gloom,

maintained its coveted global ranking intact. It was also a milestone year in the sense that

domestic crude steel capacity crossed the avowed 100 million tonne mark as major expansion

projects started to take shape.

With improvement of crude steel was at 81.69 mt, increases of 4.2 per cent. Crude steel capacity

reached 101 mt, a growth of 4.1 per cent. Production for sale of sponge iron was 18.20 mt, a

growth of 27 per cent. Pig iron production for sale was 7.95 mt, an increase of 16 per cent. Total

finished steel production for sale was 87.67 mt, an increase of 7.3 per cent. Export of total

finished steel reached 5.98 mt, an increase of 11.5 per cent. India was a net exporter of total

finished steel. Consumption of total finished steel was 74.09 mt, an increase of 0.8 per cent.

In the year of 2013-14 growth rate of the IIP does not come as a surprise given the sheer

volatility displayed by the index throughout the year as it seesawed between a lowly range

defined by a negative growth rate of (-) 2.2 per cent (attained in June 2013) and 2.6 per cent, the

maximum monthly growth rate that could be attained (in July 2013) during the year. The index

did show some signs of pick up/stability during the Q2 quarter (reflecting similar improvements

in the GDP) but failed to sustain thereafter.

2014-15 promises among others, the rebound of economic growth. Such belief is wide spread,

that the ‘Worst’ is over. Nonetheless, even as the policy mechanism gears up to provide the

much-needed fillip through both monetary and fiscal moves, leading think-tanks have lowered

their growth forecast for India for 2014-15, with expectations on economic growth during the

year hovering in the 5-5 per cent market at best. But if achieved, this would perhaps be the best

that can be said for the Indian economy.



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Indian Steel Industry : Past, Present and Future

From a 1-million tonne capacity industry at the time of

independence to the 4th

largest crude steel producer in the world,

from a fledgling industry to one accounting for a capital base of

Rs 90,000 crore (and expanding further), 2 per cent of GDP,

weight of 11.6 in IIP and providing employment to more than 6

lakh people, from being a BF-BOF oriented industry to having

state-of-art world-class technologies today, from a negligible

global presence to being acknowledged globally for its quality of

product (reflected in rising exports) and making a mark in the

global M&A market, from dependence on imports to import

substitution, from a zero presence to being the largest producer of

sponge iron globally, from a passive role in control era to a pro-

active one in the era of market economics – the achievements of

the Indian steel industry are many as it traversed its long history,

responding to the challenges of the highs and lows of business cycles.

Phase – I: Pre-deregulation (-1992)

The period till 1947 witnessed a small but viable steel industry in the country, which operated with capacity of about

1 million tonne (mt) and was completely in the private sector, Tata Iron & Steel Co (now Tata Steel Ltd.)

established in 1907 was one of the earliest entrants to the steel field in the country, The first major change came

during the first three Five Year Plans (1952-1970), when in line with the economic order of the day, the iron and

steel industry was earmarked for state control. The policy regime governing the industry during these years

consisted of :

Capacity control measures : licensing capacity, reservation of large-scale capacity creation for the public

sector units. Private sector had a limited role to play.

A dual prices system : price and distribution control for the integrated large-scale producers (BF-BOF route

and capacity exceeding 1 mt per year ) in both the private and the public sector, while the rest of the

industry operated in a free market.

Quantitative restrictions and high tariff barriers.

Railway freight equalization policy to ensure balanced regional industrial growth

Controls on import of inputs including technology, mobilization of finances, exports.

It was the large-scale capacity creation in the public sector during these forty odd years that was mainly responsible

for making India the 10th

largest steel producer in the world as crude steel production grew markedly to nearly 15 mt

in the span of a decade from the mere 1 mt in 1947. But the trend could not be sustained as from the late 70’s

onwards, economic slowdown adversely affected the pace of growth of the Indian Steel industry.

Phase – II : De-deregulation /De-control and the Aftermath Years (1992 – 1996)

Nothing remains constant for long. The slowdown phase was reversed when in 1991-92, the twin waves of

liberalization-globalization hit the Indian shores and the Indian iron and steel industry entered its second phase.

The provision of the New Economic Policy impacted the Indian steel industry in many ways.

Large scale capacities based on BF-BOF route were removed from the list of Industries reserved for the

public sector. Licensing requirement for additional capacities was also withdrawn.

Private sector came to play a prominent role in overall setup.

Price and distribution control mechanism were discontinued.



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Iron and steel industry was included in the high priority list for foreign investment, implying automatic

approval for foreign equity participation up to 74% subject to the foreign exchange and other stipulations

governing such investments in general.

Freight equalization scheme was replaced by a system

of freight celling

Peak import tariff were reduced from more that 100%

to about 30% average

Quantitative import restrictions were largely removed.

Export restrictions were withdrawn

Phase – III: Enter, Slowdown (1996-2001/2)

The euphoria did not last long. The invisible linkages between

economic growth and the steel industry become apparent when

after 1996-97, with the steady decline in domestic economic

growth rate (accentuated in turn by developments in the global

economy), the Indian steel industry’s pace of growth plateaued off and this we may mark as the third phase in its

evolution. In term of all the performance indicators – capacity creation, production, consumption, exports and

profitability - the Indian iron and steel industry performed miserably during this period which saw the economic

devastation caused by the Asian financial meltdown, the slowdown of the global economy and impact of glut

created by additional supplies from the newly steel-active countries.

Phase – IV: China and Resurgence (2002/3-2006/07)

Winds of recovery in the early days of 2002 led to a turnaround in the domestic iron and steel industry, reflecting

similar improvements in the global steel scenario as well. At the same time, global economy recovered – helping to

sustain the recovery process of steel.

The role of China in giving form and shape to this recovery process is no longer unknown. A spectacular economic

growth, an awesome infrastructure base, swelling foreign direct investments, rapid industrialization, incredibly low

manufacturing costs, rising exports – the rise of China as an economic superpower led to a soaring demand in steel

consumption, which domestic supply could not meet adequately

With time, the rapid pace of growth of the industry and the observed market trends called for some guidelines. Thus

was born the concept of the National Steel Policy, with the aim of provided a roadmap of growth and development

for the Indian steel industry. Released in 2005, it had the long term goal being that India should become self-reliant

and globally competitive in the steel sector and set an ambitious vision for the country to produce 110 MT of steel

by 2020.

With 2006-2007, India also rounded off the 10th

Plan period, a phase when both finished steel production and

consumption recorded robust 10 per cent growth (on compounded basis), achievements that indicate the stable

foundation for future development that Indian steel industry has be able to lay down during this time. As in case of

crude steel, where India ranked 4th

as the world largest producer in 2010, the country also made a mark globally in

the production of sponge iron/DRI.

Phase – V: 11th

Plan and Global Recession (2007/8-2001/12)

Emboldened by its strong past performance, industry moved ahead into 2007-08, the year which for India marked its

stepping into the 11th

Five Year Plan – a period, which saw industry face a gamut of challenges emanating not only

from domestic platform but also from global steel market, where strong recessionary trends had a cascading effect

worldwide.



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The three years, 2005-06 through 2007-08 witnessed double-digital growth in total finished steel ( alloy +

non alloy ) real consumption which sank to a mere 0.43 per cent during 2008-09 due to the impact of the global

recession but with onset of recovery in 2009-10 onwards, growth in real steel consumption returned to the pre-crisis

double-digit level once again in 2009-10 (13.3 per cent) and was sustained in 2010-11 (11.9 per cent) and in 2011-

12 (6.9 per cent).

The silver lining was that the budgets reiterated their focus on

infrastructure development – a big positive for steel. However, despite

the odds that the year threw up, Indian steel industry was able to deal

with them satisfactorily and was helped in this regards by able policy

support and of course, its own inherent strength to push its limits that

helped overcome the odds posed by market forces.

For Indian steel, ‘raw material assurance’ got a new dimension during

2011-12 with the Hon’ble Supreme Court clamping down heavily on the

iron ore mining in Karnataka, that has a cascading effect on the iron and

steel industry. With the passage of time, restrictions were further lifted

by the Apex Court on around 18 mines in Karnataka under strict

conditions of operation which is expected to streamline the availability

situation further. A 30 per cent export duty on all forms of iron ore and

fresh restrictions on mining and exports in Goa and Odisha meant

significant impact on domestic iron ore – and steel – supply scenario.

Phase VI : The 12th

Plan –Early Years (2012-13)

Slowdown hit Indian economy squarely in 2012-13, the 1st year of the 12

th Five Year Plan. With growth rates in

major steel consuming sectors slowing down markedly , as reflected in records-low quarterly GDP numbers and IIP

figures, it was only a matter of time that the domestic steel industry would feel the pinch

Real consumption of total finished steel at 73.48 mt during the year marked an increase of 3.5 per cent over 2011-

12 and with production of sale at 81.68 mt (up by 7.9 per cent), the gap between supply and demand persisted. The

result was that India remained a net importer of total finished steel in 2012-13, with exports (5.37 mt, up by 17 per

cent) remaining way below imports at 7.92 mt, an increase of 15.5 per cent as compared to last year.

2013-14 also saw India emerge as a net exporter of total finished steel breaking a long run of being a net importer. It

also maintained its coveted global rankings. It was also a milestone year in the sense that domestic crude steel

capacity crossed the avowed 100 million tonne mark as major expansion projects started to take shape.

Moving Ahead……….

With betterment of overall economic conditions at home as also globally widely projected in FY15, 2013-14 had

proved to be another year when the India steel industry was at its resilient self.

A strong economic foundation, a rising domestic supply side, stable end-use segments, large-scale infrastructure

investments, optimistic economic protections – all other things remaining same, the future prospects of Indian steel

industry appears bright enough. The WSA has projected Indian steel demand to grow by 3.4 per cent in 2014 as

compared to global steel use growth of 2 per cent and Chinese growth of 1 per cent. For 2015, further recovery is

projected for world (2 per cent) and India (6 per cent) and a slowing down for China (0.8 per cent).

[ source JPC ]

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ENVIRONMENT & SAFETY Nothing is more important than the safety and health of the people who work in the steel industry.

Protecting the safety and health of everyone who works in or around the

steel industry is of vital importance to all our members. The duty of care and

social responsibility demands that everyone is able to work in a safe and

healthy work environment.

The LTIFR is a calculation made on the basis of each time a contractor or

employee is prevented from starting their next scheduled shift due to a work

related injury, divided by 1 million man hours. Whilst the figures do show

impressive improvement there is still much progress to be made until we

reach the ultimate target for the industry - the ‘zero’ goal: an injury-free,

illness-free and healthy workplace.

The Accident-Free Steel project

The Accident-Free Steel challenge was first launched in 1999 allowing all steelmaking organisations to benefit from

the knowledge and experience available in the industry.

Safety and health principles for the steel industry

Nothing is more important than the safety and health of the people that work in the steel industry. This commitment,

endorsed by the Board in 2006 is supported strongly and is accompanied by a set of six

principles:

1. All injuries and work-related illnesses can and must be prevented.

2. Management is responsible and accountable for safety and health performance.

3. Employee engagement and training is essential.

4. Working safely is a condition of employment.

5. Excellence in safety and health supports excellent business results.

6. Safety and health must be integrated into all business management processes.

1. Safety and health metrics survey

Measuring performance is only one aspect of achieving good safety and health standards. worldsteel encourages all

of its member companies to participate in the data collection and report as accurate information as possible.

This information not only concerns the number of incidents that occur (number of fatalities, lost time injuries, medical

treatment, first aid, near misses or safety deviations) but also all the actions taken to avoid further similar incidents for

example: hazard identification and risk assessments, audits and training programmes put in place. [ source WSA ]

CONTINUE TO THE NEXT ISSUE ---.

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TAXATION/ LEGAL NEWS

F. No. 390/Budget/1/2012 -JC

Government of India

Ministry of Finance

Department of Revenue

(Central Board of Excise & Customs)

Circular No. 993/17/2014-CX

New Delhi, dated the 5th January, 2015

To,

1.All Principal Chief Commissioners, Central Excise & Service Tax/Customs

2.All Chief Commissioners, Central Excise and Service Tax/ Customs.

3.Chief Commissioner (AR), CESTAT, New Delhi.

4.All Principal Commissioners of Central Excise & Service Tax/Customs.

5.All Commissioners of Central Excise, Service Tax and Customs

6.All Commissioners (AR), New Delhi, Mumbai, Chennai, Kolkata, Bangalore & Ahmadabad

7. Webmaster

Sub: Mandatory pre - deposit of duty or penalty for filing appeal – reg.

Attention is invited to Circular No 984/08/2014 - CX dated 16th September, 2014 on the captioned subject. While

para 6 of this Circular laid down the procedure and manner of refund, para 7.2 clearly directed that the

Commissionerates should maintain a database of the record of deposits made so as to facilitate seamless verification

of the deposits at the time of processing the refund claims made in case of favourable order from the Appellate

Authority.

2.In order to maintain uniformity in the database being maintained, the following columns are suggested to be

maintained in a separate register (e -register preferably) in the Review Cell of each Commissionerate. The following

columns need to be filled in on receipt of each appeal memo as directed in Para 6.2 of the Circular mentioned

above.

The data should be maintained separately in respect of appeals before CESTAT and Commissioner ( Appeals) –

(i) Sl. No

(ii) Name of the Appellant/ Party

(iii) Details of duty paying document viz Challan etc

(iv) Amount of pre-deposit paid

(v) Order No and date of the order of Commissioner(A)/Tribunal

3. Rule 17 of the CESTAT (procedure) Rules, 1982 stipulates that a copy of the appeal memo is to be sent to the

Departmental Representative as well as to the Executive Commissionerate. This is required to be done by the

Tribunal registry where the appeal memo is received. It has been brought to the notice of the Board that appeals

filed before the Tribunal on or after 6th

August are not being sent to the Commissionerate. Therefore, it is

emphasized that Rule 17 ibid has to be followed and the Tribunal Registry must send a copy of the appeal memo to

the Commissionerate immediately after receipt. Similarly, a copy of the appeal memorandum filed before the

Commissioner (Appeal) must be sent to the Commissionerate concerned by the office of the ommissioner (Appeals).

This would help in processing the refund claims quickly.



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4. Para 1.2 of the Circular ibid stated that amended provisions would apply to appeals filed after 6th of August,

2014. An Act of Parliament comes in to effect on the date it received the assent of the President of India. Hence, the

amended provisions regarding filing of appeal along with stipulated percentage of pre-deposit shall apply to all

appeals filed on or after 6th

August, 2014. Para 1.2 of the earlier Circular stands suitably modified.

5.Several representations have been received by the Board stating that some Commissioners (Appeals) have been

insisting on pre -deposit in cases of demand of erroneous drawback granted. It has been represented that drawback is

not a duty and hence the amended provisions would not apply to such cases.

6. The issue has been examined. Drawback, like rebate in Central Excise, is refund of duty suffered on the export

goods. Section 129E stipulates that appellant filing appeal before the Commissioner (Appeals) shall pay 7.5% of the

duty demanded where duty and penalty are in dispute. Accordingly, it is clarified that mandatory pre-deposit

would be payable in cases of demand of drawback as the new section 129E would apply to such cases.

7. The ambit of the Section 129E of the Customs Act, 1962 in the legislation does not extend to appeals under

section 129DD before Joint Secretary (Revision Application). Therefore, while mandatory pre -deposit would be

required to be paid in cases of drawback, rebate and baggage at the first stage appeal before

Commissioner(Appeals), no pre - deposit would be payable in such cases while filing appeal before the JS(RA).

(Archana P Tiwari)

Joint Secretary (Judicial/Review)



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EVENTS

INDINOX Stainless Steel Conference 2015

25 - 26 January 2015

Mahatma Mandir, Gandhinagar

Ahmadabad, Gujarat, India

“A window to meet Indian miners and producers to explore business opportunities during one of

the most prestigious stainless steel event of the year”

Metal Recycling Association of India ( Voice of the Indian Recycling Industry )

5&6 February, 2015 - MUMBAI [email protected] Phone : 022-65754321 Fax : 022-67259555 / Visit www.mrai.org.in/imrc2015/ to register online.

Iron Ore Beneficiation Africa

16-17 March 2015 | Radisson Blu Gautrain Hotel, Johannesburg

6th

Year Steel | Power | Cement | Mining National Expo 2014 12,13,14-Dec,2014

BTI Ground, Shankar Nagar, Raipur

Indore Infoline Pvt. Ltd. Manish Sinha Branch Head 406, 4th Floor, Ashiana Trade Centre, Adityapur, Jamshedpur-831013, Tel: 0657-2383186, 6551021, Mob: 9263350107 / 9334080525, Email: [email protected], [email protected]

The 18th Annual Global Iron Ore & Steel Forecast Conference & Exhibition will be held in

Perth on the 10-11 March 2015.

(This event is renowned as the world’s largest gathering of senior iron ore and steel executives

with thousands of industry personnel attending it over the years. It is recognised as the

conference that delivers vital information on the status of the global iron ore and steel sectors.).

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STEEL NEWS

India : Ordinance for auction of Iron Ore & Non coal Mines Auction

receives consent by President 13

th Jan,2015 Posted by Steel Mint

Mines & Minerals (Development and Regulation ) Ordinance, 2014 for auction of Iron Ore & Non coal mines

through competitive bidding has received consent by President, Pranab Mukherjee, cleared by Union Cabinet in its

meeting held on 5 Jan, 2015

The Union Cabinet in a meeting held on 5 Jan’15 and chaired by Prime Minister, Nerendra Modi, approved

promulgating an ordinance for auction of Iron Ore and other minerals, yet again opting the emergency route that was

adopted for coal, insurance and land acquisition reforms.

In a cabinet meeting chaired by Odisha Chief Minister, Naveen Patnaik, held on the same day i.e. 5 Jan’15 it was

decided that all the non-coal (Both Captive and non-captive) mines, which are awaiting for 2nd

and subsequent

renewal will be allocated only through competitive bidding. While, mines that are awaiting for 1st renewal will not

auctioned. The rule is not applicable for mines held by OMC and other PSUs.

The need for taking the ordinance route was felt as the government was finding it difficult to allocate mines because

the Mines Ministry could not table a Bill in the winter session of parliament to amend the Mines & Minerals

(Development and Regulation ) Act, 1957.

The previous UPA government had also tabled a Bill in 2001 to amend the Act. But, the Bill lapsed with dissolution

of the previous Lok Sabha.

Token RBI rate cut unlikely to give fillip to Indian steel demand in Q4

In a surprise move RBI cut the lending rate by 25 basis points giving some succour to the liquidity strapped market

in the twilight of FY 15.

The Reserve Bank of India cut interest rates today by 25 basis points to 7.75 per cent in a surprise inter-meeting cut,

yielding to growing signs of slowing inflation and a flagging recovery.

1. Reduce the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points from 8.0 per cent to

7.75 per cent with immediate effect

2. Keep the cash reserve ratio (CRR) of scheduled banks unchanged at 4.0 per cent of net demand and time

liabilities (NDTL).

The wholesale price index for December, released on Wednesday, rose just 0.11 per cent year-on-year Wholesale

prices were unchanged in November giving clear signs of stagnating economic growth.

In a bid to counter sagging growth and demand in the economy this measure might be too little too late. Steel sector

has been plagued with lack of demand owing to absence of new infrastructure projects and dearer credit sapping

construction activity. Steel consumption in India has crawled at meagre 1.4% growth (April-December) leaving the

market oversupplied and prices dipping.

Q4 (Jan-March) is typically period of accelerated demand owing to project completion deadlines but this year is

likely to be wash out.



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To know the prevailing prices and have unlimited access to such articles, please visit http://prices.steelguru.com and

avail 7 days FREE trial.

You can keep track of prices of more than 800 items including raw materials, metallics & semis, long products and

flat products by subscribing to recently launched revamped SteelGuru’s Market Intelligence Services PS14.

Visit http://prices.steelguru.com and submit your details for FREE trial

CG High Court enforces change in VAT/CST rates in Chhattisgarh

Chhattisgarh High Court on January 9th 2014 overruled the existing notification on taxation on sale of goods in

Chhattisgarh and ruled that each goods will taxed uniformly and to all class of dealers, resulting in change of tax

structure for sale of steel

For Manufacturers

1. Rerolled product like angle, channel, TMT and bars etc will attract vat of 3 %.and without 'C' form CST will be 3

% but manufacturer whose plant/machinery is above INR 10 crore will charge 2 % CST against 'C' form and whose

plant/machinery is below INR 10 crore will charge 1 % CST against 'C' form

2. Items like ingot, billet and sponge iron will attract 5 % VAT and against declaration it will attract 2 % VAT,

while without 'C' form it will be sold at 5 % CST. but manufacturer whose plant/machinery is above INR 10 crore

will charge 2 % CST against 'C' form and whose plant/machinery is below INR 10 crore will charge 1 % CST

against 'C' form

3. Items like scrap will attract 5 % VAT and against declaration it will attract 2 % VAT, while without 'C' form it

will be sold at 5 % CST and against 'C' form it will be sold at 2 % CST

For Traders

1. They will sell the Rerolled product like angle, channel, TMT and bars etc at 3 %.vat and without 'C' form at 3%

CST while they will charge 2 % CST against 'C' form

2. Other items like plates, sheet & wires etc will attract 5 % VAT, while against 'C' form they will charge 2 % CST

and without 'C' form they will charge 5 % CST

The re-rolled products like angle, channel, TMT and bars etc which are in stock till date will be sold at new effective

tax rate.

To know the prevailing prices and have unlimited access to such articles, please visit http://prices.steelguru.com and

avail 7 days FREE trial.

You can keep track of prices of more than 800 items including raw materials, metallics & semis, long products and

flat products by subscribing to recently launched revamped SteelGuru's Market Intelligence Services PS14.

Visit http://prices.steelguru.com and submit your details for FREE trial

http://prices.steelguru.com/






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President promulgates new ordinance for Indian mining sector

India's President Mr Pranab Mukherjee has given his assent on mines ordinance that paves the way for auctioning of

mines containing minerals such as iron ore and bauxite.

The Government has promulgated an Ordinance on Monday, the 12th January, 2015 (MMDR Amendment

Ordinance, 2015) under Article 123(1) of the Constitution. This amends certain provisions of MMDR Act, 1957.

The salient provisions of the Ordinance are as follows

{Amendment to Section 5(1)} The previous approval of the Central Government will not be required for grant of

mineral concession except for Atomic Minerals, Coal and Lignite

{Section 8 A (1), (2), (3) and (4)} Uniform lease period of 50 years; no renewals; auction at the end of lease period;

will solve issues arising out of all SC judgments on second and subsequent renewals

{Section 8 A (5) and 8 A (6)} Transition period of minimum 15 years for captive mines and 5 years for other mines;

no sudden stoppage as a result of amendment

{Section 9 (B)} District Mineral Foundation to take care of people and areas affected by mining

{Section 9 (C)} National Mineral Exploration Trust to be set up for impetus to exploration

{Section 10 B &11} All mineral concessions will be granted only through auction

{Section 10 B & 11} Direct auction for mining leases for bulk minerals and auction of prospecting licences cum

mining leases for deep seated minerals

{Amendment to Section 11 (B)} Central Government to frame separate rules for atomic minerals

{Section 12 (A)} Easy transferability of concessions obtained through auctions so as to attract private investment

and FDI

{Section 17 A (2A)} Enabling powers for reservation for the public sector to continue

{Section 20 A} Central Government empowered to prescribe deadlines for various processes and to issue binding

directions to States

{Amendment to Section 21(1) & (2)} Higher penalties and jail terms for offences; special courts may be constituted,

if necessary

{Amendment to Section 30} Powers to Central Government to intervene even where State Governments do not pass

orders within prescribed time lines; this will eliminate delay

Source - Strategic Research Institute, Steel Guru

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Steel Re-Rolling Mills Association of India · 2015. 2. 9. · [39th Issue Steel Re Rolling Mills Association of India visit Page 4 SRMA STEEL NEWSLETTER SRMA Steel Re Rolling Mills