Will Companies Pay Market Price of Minerals
To Public Exchequers as demanded by CFD?
Sankarshan Acharya
sacharya@pro-prosperity.com

July 09, 2006

CFD has demanded since August 2004 that miners pay market prices of minerals to public exchequers, as opposed to artificially fixed royalties.  The royalty payment –  fixed by government decree –  amounts to blatant subversion of constitutional guarantee of economic justice to public.  Economic justice can be judged only by laws of economics, i.e., supply and demand that determine the market price.  Market price has to be the basis of economic justice guaranteed in the preamble of our constitution. 

CFD has written numerous missives on this issue to India’s constitutional head, the President, Supreme Court Chief Justices, and executives, Prime Ministers and Chief Ministers.  CFD has also campaigned with grass-root leaders like Sarpanchas and Zila Parishad presidents of a mineral rich state of Orissa.

The following news clip shows that the Communist Party (Marxist) of India has embraced CFD’s mineral policy proposal in its entirety.  CPM seems to agree with CFD that companies must pay market prices of minerals and that India must not export minerals. This is a very welcome development.  The ruling UPA government of India will have no option but to toe the line of CPM whose support is critical for survival of the government.  No matter what, the Left Front will likely garner popular support on this issue in the next election.  The CPM’s taking up this issue will surely rock both the Congress and the BJP that have received financial support of crony miners so far.

        

Mittal Orissa project runs into Red Wall
Times of India (July 9, 2006)

Bhubaneswar:  Having weathered xenophobic opposition in Europe over the Arcelor deal, Laxikant Mittal may now have to steel himself against Left resistance as he treads into the Indian market.

CPM General Secretary Prakash Karat, who is keeping a close watch on the Center’s economic policy, on Saturday warned that the party would oppose Mittal’s Rs.40000 crore Orissa foray if the state tried to give him iron ore cheap and allowed him to export ore.

“We are opposed to any company being given mineral resources without paying market price and their export.  This has been our stand on the Posco project.” Karat said.  “We will pursue the same stand if the government provides similar benefits to the Arcelor-Mittal Group,” he added.

Karat’s statement comes a day after Mittal announced that he was going to set up a plant in Orissa to produce 12 million tones of steel annually.

Interestingly, Karat chose to use a made-in-China crutch to defend the CPM position despite the fact that Beijing has almost thrown out Marxism.

He said China produced 10 times more steel than India but did not squander its own mineral resources.  Rather, China imported iron ore for its use.  “Surprisingly, India has been allowing mineral exports which is detrimental to the country’s interests,” he said.

“We are not opposed to industries per se, but the country’s precious mineral resources cannot be handed out to companies free,” Karat said.  He threatened that the party would begin a national campaign against exports of minerals.  “The government cannot do whatever it wants in the name of liberalization,” he added.