The Indian Bureau of Mines (IBM) has flagged the issue of illegal transportation of manganese ore leading to massive loss of revenue in Odisha.
The IBM informed the Ministry of Steel and Mines that mining lease holders in Odisha were dispatching manganese ore as low-grade from their mines to the traders operating from West Bengal, who subsequently sold it as high-grade without any processing. The bureau examined the issue regarding Siljora Kalimati Iron and Manganese ore mines.
In November 2022, the Ministry had alerted the Odisha Government about the under-reporting of grades of chromite and manganese ores. It had recommended the State Government come up with Standard Operating Procedure for preventing loss of revenue due to declaration of higher-grade ores as lower grade.
“Under-reporting of grades of minerals is a serious issue and causes loss to State exchequer by way of lower collection of various payments such as auction premium, royalty, district mineral foundation funds and national mineral foundation trust,” the Ministry said in April 6 letter to the State Government..
The Ministry said, “As per Section 23C of MMDR Act, State Governments are empowered to make rules for preventing illegal mining, transportation and storage of minerals. It is the responsibility of the State Governments to establish the correct grade of mineral being dispatched and change action premium, royalty and other payments on the correct grade of mineral.”
Odisha is a mineral-rich State having 96.12% of the country’s chrome ore, 51.15% bauxite reserve of India, 33.61% of hematite iron ore and 43.64% of manganese. In the past, the Naveen Patnaik Government had received flak from Opposition which alleged massive irregularities in the mineral sector leading to huge loss and that politicians in power and bureaucrats were recipients of ill-gotten money from the mining sector.
The M. B. Shah Commission that had probed into the issue had given a report that put the extent of irregularities at ₹59,000 crore.
Addressing a press conference here, Bhubaneswar Member of Parliament Aparajita Sarangi said, “The investigation done by the IBM clearly indicates that there is loss of thousands of crore to the State exchequer by deliberately downgrading the quality of ore being produced in many of the auctioned mines. This cannot happen without the connivance of the State Government and its machinery.”
“In case of Siljora Kalimati Iron and Manganese ore mines, before auction, the low-grade manganese ore ranged from a low of 4.86% to a maximum of 40%. However, this has been raised to 98% and 96% respectively in the last two years. This lowering of grade of ore has led to a huge loss to the State exchequer,” pointed out Ms. Sarangi.
The BJP MP alleged, “In spite of repeated efforts on the part of the Ministry of Mines, the State Government seems to have turned a blind eye to the rampant corruption in iron ore, chrome ore and manganese mining. No standard operating procedure has been developed to prevent recurrence of such theft through downgrading the ore.”
“Instead of initiating steps for cancellation of the lease, the State Government has given a window of opportunity to the mine owners by raising a demand and allowing them to get a stay order from the High Court or the Mines Tribunal,” she further alleged.
