Expressing concern over losing huge revenue due to non-revision of coal royalty, the State Government has urged Centre to complete the process without further delay.
It may be mentioned that royalty on coal was last revised on May 10, 2012. The current rate of royalty on coal is 14 per cent ad valorem, which has not been revised even after more than four years, said a senior Government functionary, adding that the average realization of royalty on coal in Odisha is about Rs 115 per ton.
Even as the Union Government has constituted a ‘study group’ to consider revision of rate of coal royalty on July 21, 2014, there has not been any significant progress so far to expedite the matter.
Apparently worried over the nonchalance of Central authorities, the State Government has approached the Union Ministry of Coal to revise the royalty rate of coal without further delay.
While keeping the coal royalty revision issue in cold storage, the Centre has started levying “Clean Environment Cess” on coal at Rs 400 per ton, which is almost four times of the royalty earned by Odisha.
Sources said that the cess amount is not shared with coal bearing States, nor the States get any benefit from the “National Clean Energy Fund” in proportion of their contribution to the cess.
Such a situation, if not corrected, will perpetuate the inequality further, stated the State Government while urging the Union Government to take immediate steps for revision of royalty on coal.
Odisha has also asked Centre to take steps for compensating the coal bearing States suffering the brunt of the negative externalities of coal mining and coal based power plants out of the cess collected on coal through appropriate fiscal instrument and policy measures.
The Centre gets nearly Rs 12,000 crore every year from cess which is collected at the rate of Rs 400 per ton.
While Odisha is bearing the brunt of the negative impact of coal mining, Mahanadi Coalfields limited (MCl) extracting coal from the State is the largest contributor to the Clean Energy Cess on coal, said sources.
The State Government has pointed out that it has been established in a study undertaken by the Planning Commission that adverse impact of the coal mining and coal based power plants are either partially compensated or not compensated at all.
TERI took up the study at the behest of Planning Commission and advised for compensation through a remediation fund.
As Odisha, being a worst sufferer, is not compensated due to absence of policy framework, necessary remedial steps may be taken to correct the imbalance in this regard, the State urged the Centre.
Raking up the issue of transfer of additional levy realized from various companies on account of cancellation of coal blocks, the State Government has made a strong claim in this regard.
It pointed out that the Government of India has received Rs 6,801 crore by way of additional levy realized from 31 cancelled coal blocks in various States from corporates like Hindalco. The additional levy of Rs 295 per metric ton has been levied by the orders of Supreme Court, which was suggested by the Comptroller and Auditor General (CAG).
The amount of Rs 560 crore payable by Hindalco on account of Talabira-I is a legitimate claim of the Odisha Government, said sources in the State Government.
Even as other States like West Bengal and Chhattisgarh have also put forth their claims on this count, the amount has not been transferred to them so far.
Against this backdrop, Odisha urged the Union Government to issue suitable advisory to the Ministry of Coal for release of the claimed amount to the State at the earliest.