Indian government to allot shares in mining companies to affected locals

Overruling objections from within the government and coal and steel sectors, India's Ministry of Mines has decided in favor of allotment of equity shares of mining companies to project affected persons (PAPs) in areas where projects are undertaken by such mining companies, an official at the Ministry of Mines said on Tuesday, August 21.
 
The necessary provisions to ensure such allotment of shares will be incorporated in the Mines and Minerals Development & Regulation (MMDR)  Bill 2011 slated to be brought before the Indian parliament shortly, the official said.
 
The official went on to say that representatives from Ministries of Coal and Steel have raised objections to allotment of shares to PAPs on the grounds that the allotment of the shares in question would push up the costs of coal and steel projects and also change the shareholding pattern of mining and steel companies with captive iron ore mines, but that the Ministry of Mines has decided to push ahead with the proposal which has also been approved by a Standing Committee of Parliament.
 
On August 15, Indian Prime Minister Manmohan Singh stated in an address to the nation that the MMDR Bill will be converted into legislation at the earliest opportunity to the benefit of local communities and tribes in mineral-rich regions.
 
Apart from allotment of shares of mining companies to PAPs, the proposed MMDR laws also  provide for coal mining companies to share 26 percent of profits with locals and for miners of other minerals to share 100 percent of royalties with PAPs.