Reports suggest that Odisha government has made some reservation in maintaining its commitment to supply raw material to steel projects, the memoranda of understanding (MoU) for which are already signed.
In the case of existing MoUs, the government may not retain any clause committing grant of or recommendation for grant of Mineral Concession, a guideline released by the state steel and mines department shows.
The guideline, however, adds, “Related clauses of the original MoU may be suitably revised providing that the commitments made in the original MoU will be honoured subject to and as far as consistent with the provisions of MMDR Act and MC (Mineral Concession) rules applicable on the date of recommendation.
Reports suggest that the above condition created uncertainty for Rs 1.4 lakh crore of investment involving about two dozen companies, including the big ticket ones like Posco and ArcelorMittal.
Sources said, the MMDR Act does not provide for reservation of resources for private companies. Though the grant of prospecting license (PL) or mining lease (ML) under the act is based on “the first come and first served” principles, the government often go around this rule to pick and choose beneficiaries by invoking Section 11 of the Act which allows it to recommend the case of particular company whose project stands to benefit the state most.
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