The Orissa High Court has just made life a lot more difficult for mining companies that are sitting on their leases without hitting production targets. In a significant ruling, the court has cleared the way for the state government to take over operations at underperforming mines, using the public sector giant NMDC to extract minerals when private leaseholders fall short.
The hammer came down following a Public Interest Litigation (PIL) filed by the Citizens Action Forum. The court noted that if companies aren't meeting the minimum extraction levels promised in their contracts, the government shouldn't just stand by. By invoking Rule 12(1)(EE) of the General Concession Rules, 2016, the bench ruled that the state can step in, get the job done through NMDC, and then send the bill for the entire operation directly to the defaulting leaseholders.
The numbers behind the legal battle are telling. Odisha is the heart of India's iron ore industry, sitting on about 28 per cent of the country's total reserves. Currently, 63 mines are legally cleared to produce roughly 246 million tonnes per annum (MTPA). Yet, in the 2024-25 financial year, production, reportedly, stalled at just 159 MTPA— barely 64 pc of what’s allowed. This massive gap sparked allegations that leaseholders were intentionally throttling production and that the government was being too soft on them.
This "work it or lose control" directive is a clear signal that the state isn't going to let valuable resources sit idle. For the 63 iron ore mines currently operating in Odisha, the choice is now simple: either hit the environmental clearance targets or pay the government to do it for them.
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