Mining projects worth Rs 41,000 crore stalled over land acquisition

6 November 2017

Mines department had signed 17 MoUs, with a proposed investment worth INR 45,532 crore, during the Resurgent Rajasthan summit in November 2015. However, till April 2017, only INR 4395.27 crore (or 9.65%) investment had materialised. The government had hailed the summit for bringing in much needed private investment.

Industry players, however, said that hurdles remain, especially land acquisition, as stringent rules under the Land Acquisition Act 2013 make it a tough proposition.

Among the big-ticket investors were Ambuja Cement, Jindal Saw, Reliance Cement, Steel Authority of India Ltd., Rashtriya Ispat Nigam Ltd and Ultratech Cement. Now, many of the proposals have been put on hold or entirely dropped because of delay in land acquisition, as land is either charagah (pasture) or forest land.

With assembly elections due next year, the Vasundhara Raje government is eager to fast-track the projects by easing land acquisition norms. In April, the government eased rules relating to charagah land acquisition for mining. Companies were allowed to acquire pasture land coming in the way of mining projects and provide land in lieu in the same village.

The cabinet also amended rules of the Rajasthan Tenancy Act 1955, which now makes it easier for firms to acquire charagah land. It has done away with a provision which required companies acquiring land to compensate by giving the same amount of land in the same village or adjoining panchayat. Now, land can be given anywhere in the district.

Aparna Arora, principal secretary, mines and petroleum department, accepted that several projects were stuck over land acquisition. “I met the promoters in September and asked them to expedite the projects. They have been asked to identify land and give proposals to the revenue department by October.”

Industry watchers said that land acquisition will take time given the rigorous provisions. “The government is trying to be industry-friendly and have put in place a single window system. However, getting project clearances is still time consuming,” said an industrialist, who did not want to be named.

Mr Suresh Agarwal, president, Federation of Rajasthan Trade and Industry, said that the government should acquire land and then provide it to the industry. “Land rates are so high that many investors lose interest. Moreover, the provisions of land acquisition act are stringent, for instance, compensation under the land acquisition rules is high and consent of 80% of those whose land has to be acquired has to be taken.”

Mr Nitin Gupta of CII said that the government’s efforts to promote ease of doing business have improved things but land acquisition is still a hurdle. He said that negotiating with landowners is a difficult task. “While industrial land can be acquired in RIICO industrial areas, for mining land has to be acquired where the minerals are present. The land can be under forest or charagah, which creates problems,” he said.

Of the 17 MoUs signed, only Wonder Cement’s project, with an investment of INR 1500 crore, has been implemented till April. Three projects Hindustan Copper Ltd worth INR 900 crore, Hindustan Zinc Ltd worth INR 8357 crore and Ultratech Cement worth INR 2100 crore are also under implementation.

Proposals of Rajputana Cement (INR 3000 crore), Jindal Saw ( INR 2500 crore), NLC INR 5520 crore), FCI (INR 250 crore), Ambuja Cement (INR 2500 crore), Ramgad Mineral (INR 500 crore) and Reliance Cement (INR 3400 crore) have not yet been approved as they are stuck over land issues or mining lease permissions.

A INR 2000 crore proposal by Marwar Cement is pending with the promoter while proposals of Harithal Marble (INR 5 crore), OJaswi Marble (INR 1000 crore), SAIL INR 6500 crore), Rashtriya Isapat Nigam Ltd (INR 2500 crore) and Ultratech Cement (INR 3000 crore) have been dropped.

Source: HT