The National Mineral Development Corporation (NMDC), a Central government undertaking, has suspended mining operations at its Donimalai Iron Ore Project in Sandur taluk of Ballari district since November 4, 2018, after the State government insisted on payment of a premium of 80% of the average sale value of the ore.
The average sale value is published by the Indian Bureau of Mines (IBM). The condition was imposed by the State government on November 2, 2018, when the NMDC applied for extension of its lease for 20 years from November 4.
NMDC chairman and managing director N. Baijendra Kumar, in a letter to Chief Minister H.D. Kumaraswamy in November, expressed concern over the new condition. He maintained that it would make mining unviable and drive the company to a situation of incurring a loss of ₹944 crore a year.
According to him, the NMDC would incur a loss of ₹1,348 a tonne if the condition is accepted.
“With the new condition, it will be very difficult for the NMDC to continue its mining operations and it will lead to the closure of the only ‘five star’-rated mine under the Sustainable Development Framework in Karnataka, leaving a cascading effect on the company, its employees, and the livelihood of people... and may lead to social unrest owing to unemployment,” he said in the letter.
As there has been no response from the government to the request to withdraw the new condition, the NMDC has filed a writ petition before the High Court of Karnataka challenging the imposition of the condition.
Agitations planned
The Donimalai Iron Ore Project Employees’ Association and the Metal and Mineral Workers’ Union have launched a ‘Save Donimalai–Save NMDC’ campaign. They have planned to take up a series of agitations, starting with “Ballari chalo” on January 14, to mount pressure on the government to withdraw the condition.