The Centre has advised states to be “very vigilant” about spending the funds collected under the District Mineral Foundation (DMF), failing which the purpose of creating it will be defeated, a top official from the Mines Ministry said.
“The objective behind creating DMF is to collect funds that will be used for people affected by mining. It is a very promising concept now and we hope it does not go astray in future. So we have asked states to be very, very vigilant on working of the fund,” Mines Secretary Anup K Pujari told PTI.
In March, Parliament passed the Mines and Minerals (Development and Regulation) Amendment Bill, 2015, which had provision for creating DMF that will work for the benefit and in interest of the people affected by mining operations. Its composition and functions shall be prescribed by states.
Mr. Pujari said that initial discretion is very important in ensuring that DMF is spent for the betterment of the people and areas affected by mining.
“States will have to be careful with DMF spending and they will have to ensure that there is correct leadership at the district level so that DMF funds are utilised exactly for the purpose that they are created,” he added.
For existing miners the DMF can go up to the amount of royalty paid by them, while for new leaseholders this amount is one-third of the royalty amount. The government expects annual contribution from DMF to top around Rs 10,000 crore.
However, no state government has so far created the DMF.
According to the last CCEC (Coordination-cum-Empowered Committee) meeting held earlier this month, no state has so far constituted the DMF. Out of the 11 mineral bearing states, some work has been done on creating the fund only in Gujarat, Tamil Nadu and Jharkhand.
The states have given a deadline of creating DMF between July and September this year.
According to a state official, who was part of the CCEC meeting, the Centre has asked the states to establish DMF at the earliest, but many state governments have so far not even notified it.
