Raise coal royalty issue in houses: Odisha to MPs

Bhubaneswar: Ahead of the winter session of Parliament, Odisha government has suggested MPs from the state to raise issues relating to coal royalty and seek clarification from the Centre on delay in implemntation of the recommendations made by 12th Finance Commission and Hoda Committee.

The steel and mines department has recently sent a brief note to this effect to the Principal Resident Commisioner at Delhi for its distribution among the MPs, oficial sources said. "Due to late revision of royalty in respect of coal and non-coal, the state government has sustained a loss of Rs 126.13 crore and Rs 1727.58 crore respectively. The successive Finance Commissions have recommended for timely revision of royalty," the brief note meant for MPs said.

The 12th FC has also recommended that the loss incurred by the states on account of late revision of royalty will be compensated by the Centre, the note said. Though there was provision of revising coal royalty every three years, the state government pointed out that there was large gap. "The rates of royalty fixed by the Centre in respect of coal by way of last three revisions were in 1994, 2004 and 2009," it said. Similarly, the royalty fixed on non-coal by way of last three revisions were in 2000, 2004 and 2009, it said.

Suggesting a complete shift from the hybrid rate to the ad valorem regime of royalty, the state government said that the rate of royalty on coal should be fixed for all grades of non-cooking coal at 20 per cent of the market price of coal. The 12th FC and the Hoda Committee have also recommended ad-valorem royalty system and this was more commonly used internationally, it said adding that Odisha has the longest coal fields in the country.

As coal mining involves huge negeative externalities in terms of displacement and resettlement, law and order situation, environmental pollution, the state should be adequately conpensated for this, the note said.