Representation to the DMG at the Stakeholder meeting held at Ibrahimpatnam on 28th August 2024

28th August 2024

To,

The Director of Mines and Geology

Ibrahimpatnam

Andhra Pradesh

Respected sir,

The Mineral Chamber of Commerce, Gudur represents the interests of Mining lease holders, MSME processing units and Exporters who are into mining, processing, trading and exporting the industrial minerals – mica, feldspar, quartz and vermiculite originating from Nellore and Tirupati districts.

OMEPS PORTAL:

All our members and thousands of our industry employees are facing immense hardship due to the blocking of mineral transport permits since 12th June 2024. We request you to restore the online permit system IMMEDIATELY on a PRIORITY BASIS and save our industries which are on the verge of COLLAPSING.

Frequent blocking of permits in the OMEPS portal over the past one year has affected the image of AP as a reliable source of industrial minerals globally and we are losing our export orders and customers.

COMMON ISSUES FACED BY OUR MEMBERS

·       The mining lease holders and MSMEs have incurred huge losses due to this unexpected stoppage of all our industrial activities. We request the Government to kindly support us in the following manner.

1.     Reimbursement of MD charges, Minimum electricity charges, True up charges and FPPCA charges during the idle period of the industry.

2.     Interest reimbursement which we have paid against our industrial loans during the idle period.

·       The verification process of stocks in our yards is not scientific. The materials piled in our yard are in irregular shape and size with different bulk densities. However, the department is using an arbitrary method which doesn’t match to the density of our materials. Hence proper measuring standards to be adopted to avoid penalties to the industrial sector.

·       Material loaded vehicles to be allowed to go to the nearest weigh bridge on delivery challan. Once the weight is confirmed, the e-waybill, permit and final invoice to be issued.

·       The Department is requested to start a campaign to brand AP minerals like make-in-India, say Mined-in-AP with seal and logo. Which can be identified as ethically sourced minerals without child labour and environmental safety. This will give us a competitive advantage over states and countries where social & environmental conditions are poor.

·       Roads to mineral bearing areas to be upgraded to handle heavy vehicles – the current Sydapuram road is in a very bad state.

·       The Government is requested to set up a mechanism whereby the industry can give regular feedback on policy matters.

ISSUES FACED BY MINING LEASE HOLDERS

·       Renewal of leases and Issue of fresh leases are being delayed beyond a reasonable time frame. The Government is requested to fast track this process and encourage investments and create employment opportunities.

·       Due to market conditions, at times stocks remain unsold and permits get expired causing huge loss to the lease holders. The Government is requested to allow renewal of expired unused permits.

·       Mining leases for minor minerals are applied on mineral outcrop basis and not on systematic surveys like for minerals like iron ore, bauxite and sand. In this case the applicant is not in knowledge of deposit available and therefore auction is not the right method for grant of lease.

·       Feldspar, quartz and mica occur together in the pegmatite and it is difficult to estimate the percentage of each mineral in the ROM. The mining plans and EC permissions may have been prepared basing on a higher estimate for one mineral whereas in actual production it is possible that we get less production of that particular mineral and more production of another mineral. In this case the lease holder is left without permits for the mineral for which the higher production was unforeseen. To avoid this problem we request the Government to allow the leaseholder to draw the permits for any of the three minerals based on production and for the permits quantity the total estimated combined ROM quantity(Feldpsar+Quartz+Mica quantity) to be considered.

·       The mining industry in AP is uncompetitive compared to other mining friendly states such as Rajasthan due to the existing policies. The Government is requested to study the policies in other mining friendly states in India and make mining friendly policies and encourage investments in this sector. One such policy is the collection of the premium amount of 10 times dead rent which makes mining unviable. The Government is requested to revisit this policy. For some minerals the royalty rates and consideration amounts are very high compared to the rates in other states in India. There is a big difference in the prices of various mineral grades and having one slab royalty rate for all grades is not right and fair.

·       Whilst fixing royalty understand international market conditions of minerals demand which is a commodity, where buyers have global alternatives to source product and AP also has to compete to stay in market.

ISSUES FACED BY MSMEs

·       The Government may delink MSMEs from MDL and mineral controls for value added minerals - Once royalty is paid by mine on mineral and sold, there should not be further state government controls on the next value addition. The Mineral industry in other neighbouring states dispatch only under GST.

·       For ease of doing business, transfer of permits from MDL to MDL to be restored in OMEPS system. The current method of approval by DMO is not business friendly.

Thank you very much sir for your support and co-operation.

Yours faithfully,

Cherukuru Sundar Pranay Reddy

President