Chief Minister Bhupesh Baghel has written to union steel minister Dharmendra Pradhan, asking him to instruct the public-sector enterprise under his ministry to act “responsibly in a crisis”. Since NMDC had “diverted the corporate social responsibility (CSR) fund of the people of Chhattisgarh to the newly created PM Cares fund”, it could also pay up the Rs 1,023 crore it owed the state for mining violations, the letter said.
The state government needs financial resources to deal with the Covid-19 crisis, and “the people of Chhattisgarh are looking for their legitimate resources to come in handy during the crisis”, Baghel wrote in the letter dated May 4. ET has seen a copy of the letter.
The amount was part of the Rs 1603 crore penalty slapped on NMDC after the Supreme Court’s 2 August 2017 order interpreting “illegal mining” in a matter dealing with Odisha’s iron ore and manganese mines. Based on this landmark order, Chhattisgarh sent off show-cause notices to recover Rs 21,1001 crore from lessees, including Rs 10130 cr from the Coal India subsidiary South Eastern Coalfields and Rs 8266 from Steel Authority of India. NMDC paid Rs 600 crore “under protest” while it waited for its mines to be renewed and has been operating its mines, like most others in the state, with a stay order from High Court of Chhattisgarh.
Baghel’s letter accused the PSU of defaulting on its commitment to the state, which accounts for 90% of its iron ore, even though the Chhatisgarh government on its part had been supportive of the company’s needs.
Pradhan, who is also the union minister for petroleum and natural gas, did not respond to messages from ET seeking his comment. NMDC chairman and managing director N Baijendra Kumar could not be reached for comment. A company spokesperson said, “NMDC has excellent relations with the Chhattisgarh government and if any issues have arisen they would be resolved keeping the best interest of Chhatisgarh and NMDC in mind.”
In his letter, Baghel said his government had extended five mining leases of the PSU by 20 years. In contrast, the BJP government in Karnataka had not extended NMDC’smining rights over the Donimalai deposit, despite an amendment by the central government in September last year that required it to do so, he wrote.
The CM said he expected the Government of India “not to be a mute spectator” and instruct NMDC to make the payments at the earliest. “NMDC should consider the long-term interest in the state and try and win over the hearts of the people of Chhattisgarh by standing with them when they need it,” he added.
The Ministry of Corporate Affairs has clarified that donations made by companies to the PMCares Fund would count as CSR spending, those made to chief minister’s relief funds or state relief funds do not have that status. Following that, Baghel had written to the PM on 21 April, asking for donations made by mining companies and industries operating in Chhattisgarh into PM Cares fund to be transferred to the state immediately, since this money was meant to be spent on people displaced and affected by mining.
