ArcelorMittal Increases Its Offer Price for all Common Shares of Baffinland Iron Mines Corporation to C$1.40 per Common Share

- Increased Offer Price of C$1.40 in Cash per Common Share for 100 per cent of the Common Shares-
- Revised Offer Price is a 27% Premium to ArcelorMittal's Original Offer Price and a 150% Premium to the Trading Price of Baffinland Shares prior to Nunavut's Original Offer-
- Approximately 25% of Baffinland Common Shares are Locked-Up to the ArcelorMittal Offer -
- Support Agreement between ArcelorMittal and Baffinland Remains in Place
- Baffinland Shareholders Receive Superior Value and Certainty as Compared to the Revised Coercive Partial Offer from Nunavut
- Offer is Open for Acceptance Until 11:59 p.m. (Toronto Time) on 10 January 2011

Toronto, 31 December 2010 / Luxembourg, 31 December 2010 (14.15 CET) - ArcelorMittal today announced that it has increased its offer (the "Offer") for all outstanding common shares ("Common Shares") of Baffinland Iron Mines Corporation ("Baffinland") and all outstanding common share purchase warrants issued pursuant to a warrant indenture dated 31 January 2007 (the "2007 Warrants") to C$1.40 per Common Share. 

The increased all cash offer represents a premium of approximately 27% to ArcelorMittal's original Offer price of C$1.10 per Common Share, and a premium of 150% to the trading price of the Common Shares prior to Nunavut's original unsolicited offer in September 2010.

Peter Kukielski, Head of Mining and Member of the Group Management Board of ArcelorMittal said: "ArcelorMittal's increased Offer of C$1.40 per share for all Common Shares provides demonstrably superior value and certainty for Baffinland shareholders, compared to Nunavut Iron Ore Acquisition Inc.'s revised coercive partial offer. Our Offer ensures shareholders receive 100% cash for all of their shares, rather than cash for just some shares and diluted value for the shares not taken up under the Nunavut offer."

If Nunavut Iron Ore Acquisition Inc.'s ("Nunavut") revised offer were successful, Baffinland shareholders would face the prospect of being left with thinly traded minority Common Shares that would be unlikely to reflect the full value of Baffinland's assets. Furthermore, if Nunavut's partial offer was successful and Baffinland were to issue the approximately 157.4 million warrants contemplated in their partial offer, a substantial overhang would exist, which would lead to significant equity dilution, both of which would likely have a negative impact on the trading value of the remaining minority held Common Shares of Baffinland.

Since Nunavut already owns approximately 10.5% of the Common Shares, it is effectively bidding for only approximately 49.5%, or approximately 55.4% of the 89.5% of Common Shares it does not currently own.

In order for the value of Nunavut's revised coercive partial offer to equal the C$1.40 per Common Share offered by ArcelorMittal's increased Offer (assuming a 55.4% pro rata take-up under Nunavut's offer), the remaining minority held Common Shares would need to trade at C$1.18 per share (which assumes a warrant value of C$0.23 per full warrant using Nunavut's volatility and risk free rate assumptions as set out in its December 29 announcement), which is more than double the C$0.56 trading value of the Common Shares prior to Nunavut's original offer for all of the Common Shares in September 2010. Assuming Common Shares tendered to the Offer under lock-up agreements with ArcelorMittal do not tender and there is a 76.6% take-up under the Nunavut revised coercive partial offer, the remaining minority held Common Shares would need to trade at C$1.06 per share for the value of Nunavut's revised coercive partial offer to equal the C$1.40 per Common Share offered by ArcelorMittal's increased Offer.

Nunavut's revised coercive partial offer leaves Baffinland shareholders uncertain about: -
- how many of their shares will be taken-up due to the pro rationing of tendered shares;
- the price at which shares not taken up by Nunavut would trade should the current partial offer by Nunavut be completed;
- the timing of any amendment to its offer to provide for exchange rights;
- whether warrants would be issued in the future and the value such warrants represent; and
- Nunavut's project development plan for Baffinland.

As previously announced, ArcelorMittal has entered into a lock-up agreement with Baffinland's largest shareholder, Resource Capital Funds ("RCF"), pursuant to which RCF has tendered all of its Common Shares and 2007 Warrants, representing approximately 22.5% of the outstanding Common Shares (on a fully diluted basis), to the Offer. In addition, each of the directors and officers of Baffinland have tendered all Common Shares and 2007 Warrants held by them, representing a further approximately 2.4% of the outstanding Common Shares (on a fully diluted basis), to the Offer pursuant to lock-up agreements with ArcelorMittal.  In addition, as at 29 December 2010, no further conditions relating to regulatory approvals are outstanding under the Offer.

The ArcelorMittal Offer remains subject to the same conditions as the original Offer of 12 November 2010 as amended by the Notice of Variation and Extension dated 18 December 2010. 

The Support Agreement entered into between ArcelorMittal and Baffinland on November 8, 2010 as amended December 18, 2010, including the non-solicitation covenants and ArcelorMittal's right to match any unsolicited superior proposal, remains in place.

ArcelorMittal has today mailed a notice of variation of the Offer with respect to its increased Offer price of C$1.40 per Common Share for all Common Shares to Baffinland securityholders. The Offer price of C$0.10 per 2007 Warrant remains unchanged. The revised Offer is open for acceptance until 11:59 p.m. (Toronto time) on 10 January 2011, unless further extended or withdrawn.

Amendments to the Mines Act, 1952 (35 of 1952)

The Union Government today approved the introduction of a Bill in the Parliament to amend the Mines Act, 1952 (35 of 1952). The Bill proposes to amend and consolidate the law relating to regulation of condition of work and welfare of persons employed in mines and for the matter connected therewith or incidental thereto.

These amendments in the Mines Act, 1952 envisage extending the Act to the whole of India including territorial waters, continental shelf, exclusive economic zones and other maritime zones of India substituting the definition of owner so as to make it more comprehensive and specific; define the ‘foreign company’ with reference to the Companies Act, 1956; provide for appointment of officials in addition to agent of employer in the mines; increase in the penalties provided in various sections and to shift the burden of proof upon the person who is being prosecuted or proceeded against.

The Act was last amended in 1983. Subsequent to the 1983 amendments, several developments in the area of technology, scale of operations, working environment and work practices in coal, non-coal and oil sector have taken place. Mining operations are getting progressively more mechanised with the introduction of heavy machines, shallow deposits getting depleted and mines becoming deeper with their attendant complexities. Also operators from other parts of the world have started acquiring mining rights and managing mining operations within our country. All these developments have necessitated amendments to the Mines Act 1952.

The Mines Act, 1952 provide for the health, safety and well being of persons employed in mines. The Act regulate the working conditions and environment in mines with a view to making work more humane and to provide for measures to prevent accidents and occupational diseases and contain provision of some basic amenities to mine workers. It also prescribes a system of inspection of mines for enforcement of the legislation.

Brief on Amendments to Mines Act, 1952

• In India the Mines Act was first enacted in the year 1901. The original Mines Act was replaced in 1923 and subsequently in 1952 the Parliament has enacted the present Mines Act. The Act was last amended in 1983.

• Subsequent to the 1983 amendment, several developments have taken place in the area of technology, scale of operations, working environment and work practices in coal, non-coal and oil sector. Mining operations are getting progressively more mechanized with the introduction of heavy machines, shallow deposits getting depleted and mines becoming deeper with their attendant complexities.

• Several Courts of Inquiry and Parliamentary Committees and Sub-Committees have also recommended in the past that the Mines Act, 1952 be amended so as to keep pace with time.

• Therefore, the new preamble describes the Mines Act, 1952 as “An Act to amend and consolidate the law relating to regulation of condition of work and welfare of persons employed in mines and for the matter connected therewith or incidental thereto”.

• It is proposed to extend the jurisdiction of this Act upto the Exclusive Economic Zones an Maritime Zones of India as defined in the Territorial Waters, Continental Shelf, Exclusive Economic Zone and Other Maritime Zones Ac, 1976. (80 of 1976).

• In order to prevent evasion of responsibility and any confusion regarding management hierarchy, the term ‘agent’ is being proposed to be submitted by a new definition whereby “Agent” means every person, superior to the Manager and whether appointed as such or not, who, on behalf of the owner, takes part in the management, control, supervision or direction of the mine or any part.

• The proposed definition of “Owner” means every person or authority having ultimate control over the affairs of the mine and specifies such person ( viz. Chief Executive Officer or Managing Director) or authority under all possible circumstances in the present scenario. The proposed definition is more comprehensive and is in line with the Companies Act, 1952 ( 1 of 1952).

• It is further proposed to provide that every person who contracts for the services or operations in a mine, and includes a contractor and sub-contractor, shall also be the owner.

• Mining being very hazardous where any negligence may lead to loss of lives, the penalties need to be made stringent, at least in line with those of other similar Acts, so that the offender is not let off with a token penalty, as is mostly the case. Hence penalties have been enhanced by about 100 times.

• The burden to prove before an authority or court of law that all necessary measures had been taken and due diligence used to comply with the provisions etc. shall be that of the offender (section 74 A). This proposed provision is similar to the provisions contained in section 104A in the Factories Act, 1948 and section 16 and 17 of the Environment (Protection) Act, 1986.

• The Prime Minister’s Office on 24.2.2010 directed the Ministry of Labour & Employment to place the matter before the Committee of Secretaries for its consideration. The Committee of Secretaries has considered the proposal in its meeting held on 18.5.2010 and has decided that the Ministry of Labour and Employment may notify the proposed amendments to the Indian Mines Act, 1952 without affecting the existing rules made by the Ministry of Petroleum and Natural gas. The proposed amendments under the Indian Mines Act, 1952 will be over and above the rules as already notified by Ministry of Petroleum and Natural Gas, and will be consistent with them.

A Smarter Electric Grid for Bangalore, India

 

By Karin Rives

Staff Writer

 

Washington - A power company in Bangalore, India, will be exploring smart-grid technologies with the help of a $453,350 pilot study funded by the United States. The project could be a win-win for the two nations as they seek to build expertise and market share in the emerging clean energy sector.

 

The 12-month smart-grid study is also an opportunity for the countries to build on the Partnership to Advance Clean Energy that President Obama and India Prime Minister Manmohan Singh signed in 2009.

 

The grant from the U.S. Trade and Development Agency (USTDA) will pay a U.S. contractor to work with the Bangalore Electricity Supply Company Ltd. to explore how best to integrate smart meters and automated meter reading into an electric distribution system in the south India state of Karnataka.

 

USTDA links U.S. businesses to export opportunities while creating sustainable infrastructure and economic growth in partner countries - in this case by offering U.S. expertise to India as that nation builds and enhances its electric grid. The agency is now taking bids for the study.

 

Known as BESCOM, the Bangalore power supplier is exploring ways to deliver electricity in a more reliable and efficient way to customers in its rapidly growing service area. The company won the India Power Award in 2009 for its energy efficiency and conservation efforts.

 

It has also been working for several years to upgrade its system, in part with assistance from the U.S. Agency for International Development, according to USTDA's request for proposals for the contract.

 

The smart-grid pilot study is welcome in India, where the government is earmarking a large portion of its planned $2.3-trillion energy investment over the next few decades for renewable and clean power sources and technologies.

 

The Bangalore project will help India meet "its energy-efficiency goals, an issue of critical importance to Indian energy security," said Blair Hall, counselor for economic, environment, and science and technology affairs at the U.S. Embassy in New Delhi. "Through the grant ... India will improve its ability to streamline electricity demand."

 

THE CLEAN ENERGY RACE

 

Large economies such as those of China and the United States are rushing to develop new technology that will help the world meet growing energy demands in an environmentally friendly way, and to gain a competitive advantage in the clean-energy technology marketplace.

 

In this new environment, it makes sense for the United States and India to work together, said Nishant Shah, a fellow at the policy research group Americans for Energy Leadership.

 

"While India has not been a major investor in clean energy innovation to date, its recent undertakings signal a shift in the right direction, he wrote in a December 2010 blog entry. "Such a pursuit on the part of India could facilitate widespread adoption of clean energy technology and be a major win for U.S. economic interests."

 

In November 2010, the United States and India agreed to establish a Joint Clean Energy Research and Development Center  that seeks to mobilize up to $100 million in public-sector and private-sector funding over five years. Also under the Partnership to Advance Clean Energy, the United States pledged in November to use two government-financing vehicles - the Overseas Private Investment Corporation (OPIC) and the Export-Import Bank - to steer private sector investments in clean-energy infrastructure to India.

 

OPIC is providing $100 million in financing for solar, wind, hydropower, advanced biofuels and natural gas projects in South Asia, the bulk of which will be invested in India. More than $280 million in U.S. financing could eventually be channeled to the country.

 

The BESCOM pilot study likely will be housed in an office park outside Bangalore called Electronics City, where many of the city's information technology businesses are based, USTDA said. The state capital, Bangalore, is a thriving business community and home to 5.9 million residents.

 

(This is a product of the Bureau of International Information Programs, U.S. Department of State. )

Why Citi can never sleep

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One of the key reasons for the global financial crisis was that there were too many inadequately monitored financial products in the market.

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That a fool and his money are easily parted is a well-known saying. No one proved this better than a man called Victor Lustig who, in 1925, sold the Eiffel Tower twice — once successfully. What Lustig did was brilliantly simple: he got hold of a bunch of greedy scrap-dealers and, on the basis of a forged government document, told them that he was the deputy director general of the department of Posts and Telegraph and had been asked by the French government to sell the tower off as scrap as it was too expensive to maintain. Since originally the tower (built for the 1899 Paris expo) was to have been dismantled in 1909, everyone believed him. Lustig charmed the scrap-dealers off their feet and warned them that they were not to talk about the sale as the matter was a top state secret. But he had already decided on the buyer, whom he had correctly assessed as a greedy and corrupt fool, and convinced him saying that, as a government official, he was open to a little lolly on the side. Lustig then took his money for the tower and went off to Vienna — only to return some months later and try the same stunt again, believing rightly that the first buyer would not spill the beans. However, this time he did not succeed because word had gotten out. But Lustig was never arrested.

Citibank, which has just seen an employee pull off a similar stunt of fooling the greedy with promises of high returns backed up by forged documents, would do well to pay heed to this tale because frauds of this nature happen as greed and dishonesty come together to form an unbeatable combination. It has to ask itself how it failed to catch on. After all, it does boast that it has very sophisticated technologies and management systems. It also needs to convince customers that it is not dozing on the job while the fleet-footed make off with the booty. One way of achieving this might be to temper its own search of profits at any cost through a large number of investment products or schemes. A fraudulent product or scheme is more likely to succeed when there are 50 such products/schemes on offer than, say, 20. Let it not be forgotten that one of the key reasons for the global financial crisis, of which Citibank was a prominent victim, was that there were far too many financial products in the market which could not be monitored properly.

Indeed, as the Lustig saga shows, only luck can prevent lightning from striking twice at the same place because the world is generously endowed with persons who are rich, greedy and careless, of whom the crooked take advantage. In fairness, though, it must be said that anyone can be taken in by good manners and forgeries. Thus, even eternal vigilance may not be sufficient to prevent fraud.  

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Longer-term consequences

Author:Y.V. Reddy(Former RBI governor)

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As economic activity shifts to developing countries, there will be a greater diversity in the socio-cultural and political systems among these countries, and between them and the developed nations.

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It is very difficult to visualise at this stage the longer-term consequences of the recent international financial turmoil. However, some broad generalisation could be attempted.

First, there is likely to be a shift in economic activity from the advanced economies in the West to the emerging market economies in Asia. Economic activity will be characterised by the supply of large labour force and the demand that would be arising out of the improvements in the standards of living of the large working population which is likely to be concentrated in developing countries, and in particular, Asia.

However, it must be recognised that entry of a large working force in these economies brings with it several challenges. These include acquiring skills to be globally competitive, improving the urban infrastructure, enhancing public health and medical facilities, and above all, managing the large scale migration of people from rural to urban areas.

It is unlikely that for the foreseeable future, the per capita income of the developing countries would surpass the per capita income of advanced economies. Hence, there is need for moderation in the euphoria about shift of economic power to the developing countries and Asia.

Second, the dominance of advanced economies in financial sector is not easy to challenge because of the concentration of technology, infrastructure like credit rating agencies and news agencies, and human skills. Hong Kong, Shanghai and Singapore, or Dubai, may pose a challenge but is unlikely that they will surpass the combination of New York, London and Frankfurt, for several decades. However, change in ownership of these institutions in favour of developing economies is feasible, but change in their location is difficult.

Dollar dominance

Third, the international monetary system is characterised by the dominance of dollar as a reserve currency. Currently, the major currencies which have characteristics of reserve currency are Euro and Yen. To a marginal extent, currencies of countries, such as Canada and Australia are also utilised as reserve currencies.

It is clear that the dominance of the dollar may reduce over a period (though in the short term it continues to be safe-haven in times of uncertainties), but it is unlikely that any other currency will replace dollar as the most dominant currency for world trading and financial transactions.

The pre-conditions for currency of a developing country to be considered as a reserve currency are open capital account and acceptability to the private sector participants. The latter would require a confidence in the capacity of the economy of the country concerned to withstand global shocks.

Recent events have shown that Euro zone itself is finding it difficult to withstand shocks while Japan had to intervene in forex markets.

Fourth, the importance of a country in global economy also requires leadership in science and ideas. Further, innovation is different from adaptation. The existing lead for advanced economies in these intellectual property related issues, as for instance, the think-tanks, is significant. It requires almost a generation to bridge such gaps, unless significant public policy initiatives, and to some extent, private sector contribution are forthcoming.

Multi-polar world

It is interesting to note that the contribution of Indian private corporate sector to educational institutions such as Stanford, Cornell and Harvard University in the recent years is perhaps hundreds or even thousand times more than its contribution to the universities in India (it was recently announced that Premji Foundation is investing in education, especially in rural and school education, which is laudable, but the point on support to universities in India remains valid).

One Indian corporate house has given $50 million for a building in an Ivy League university. This is a reflection on the confidence levels of the developing economies in their own educational infrastructure.

Fifth, it is interesting to recall that for several decades after the Second World War, we had a bi-polar world, with developing countries being described as the Third World. After the break-up of the erstwhile USSR, the world was broadly divided into developed and developing, with emerging market economies being treated as a sub-set of developing economies.

Currently, the world appears to be moving in the direction of a spectrum where it will be increasingly difficult to draw a rigid line between developed and developing countries.

Finally, it is useful to note that a shift in economic importance that happened after World War II was from the UK and Europe to the US. There were significant common cultural traditions between the two regions.

However, as economic activity shifts in future to developing countries, especially Asia, there will be a greater diversity in the socio-cultural and, perhaps, political systems among these countries, and between Europe, the UK, the US and these countries. In brief, in the longer term, the world will see a significant diversity in the set of countries with global economic significance.

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45% of farmers want to quit farming: Swaminathan

Prof M.S. Swaminathan, the father of Green Revolution and Chairman of National Commission on Farmers (NCF) that called for revamp of policies to revitalise agriculture, says agricultural sector in India is entering a state of serious crisis.

Quoting figures from National Sample Survey Organisation, he says half of the farmers in the country want to quit farming. Prof Swaminathan, who was here to deliver the Convocation Address at the Acharya N.G. Ranga Agriculture University here on Thursday, called for the creation of specific mitigation policies for each of the 128 agro-climatic zones. In an interview, he speaks on the current problems Indian agriculture faces and possible solutions to tackle them.

Farmers continue to commit suicide. Hundreds of tenant farmers are reported to have committed suicide in the last few days. Why this crisis continues to haunt farmers?

We are entering a state of agrarian crisis. This crisis has many dimensions. It is not a single or simple cause that is responsible for this. There is the problem of high investments in some crops. There are problems peculiar to rain-fed and irrigated lands. Farming has become unviable. The NCF has recommended cost of production plus 50 per cent. At present, they are giving 15 per cent more as against manifolds more in other industries such as pharmaceuticals.

Probably, the Food Security Act would force the Government now to look at this issue seriously. Unless we revitalise farming and make our farmers enthusiastic it is difficult to feed 100 crore people and 100 crore farm animals. It is going to be a difficult period.

Youth are shying away from agriculture. Why is this happening and how do we make them look at farming as a profession?

If farmers are committing suicide, why should they come to farming? Farming sector is facing a number of problems. Unless we attend to them, the younger generation will not take to farming. I have asked the students to look at different aspects of agriculture in order to bring in technology and value addition into the system. Besides, we need to minimise risks and increase support services such as insurance and credit.

For different reasons more and more farmers are moving out of farming activity. Reports of shift in land use patterns from agriculture to non-agriculture are also causing a serious concern. How do you view this problem?

About 45 per cent of farmers interviewed by National Sample Survey Organisation wanted to quit farming. The pressure on land is increasing and average size of land holdings is dwindling. Farmers are getting indebted and temptation to sell prime farm land for non-farm purpose is growing as land prices go up steeply. We need to improve productivity and profitability of small holdings.

How is climate change going to impact agriculture sector and what could be the strategies to minimise risks?

We need to set up Climate Risk Management Research and Training Centre in each of the 128 agro-climatic zones. We also should evolve policies for each of these zones and develop codes for drought and flood management.

Calamity relief mechanism too needs a change. The traditional way of sending Central teams to assess the damages and bargain with States on relief will not work. This is not a way to deal with calamities. Money never reaches farmers on time to invest in the next cropping season.

Tenant farmers seem to be the worst hit as crisis hits agriculture sector. How do you view this problem and what are your suggestions to overcome this?

It is a very serious problem. Tenancy reforms need to get focus as part of agrarian reforms. The issues of owner cultivation, tenant cultivation, absentee landlords should get immediate focus. They should have a security of tenancy. Also, we are seeing increase in contract cultivation. This also requires changes in regulation. It must be a win-win situation (for owners and producers).

We need to have new systems of management. We need to put all pieces together. We don't have an integrated approach. In the West, they call it farm to fork. So many Ministries and departments are there to take care of water, rainwater, foodgrains and food processing. How are we going to deliver it as one offering to farmers would hold the key.

None of these problems are insurmountable. They are problems created by us and we can find solutions. It is right time to abandon indifference to agrarian problems.

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2700 MW Grid Connected Renewable Power Capacity Added
Biomass Gasification for Rural Electricity



One of the important activities of the Ministry of New & Renewable Energy during 2010 was the organization of Delhi International Renewable Energy Conference (DIREC 2010), which took place from 27-29 October 2010 in New Delhi, India. Its main theme was ‘Upscaling and Mainstreaming Renewables for Energy Security, Climate Change and Economic Development’. over 13,000 participants from governments, international organizations, civil society and the private sector, including 45 Ministerial delegation, attended it to discuss renewables and energy security, climate change and economic development. These themes were explored in plenary sessions as well as in ministerial, multistakeholder and CEO discussions, which followed four tracks: technology and infrastructure; policy; finance; and renewables access and the Millennium Development Goals (MDGs). Parallel workshops were also hosted on various issues including: solar power, solar water heating systems; wind energy; sustainable habitats; biomethanation; rural empowerment; smart grid technology; biofuels and clean lighting options. In addition, a renewable energy trade expo showcased the latest technology. DIREC 2010 concluded on 29 October with the adoption of DIREC Declaration and 30 new pledges by governments, civil society and the private sector under the Delhi International Action Programme to take concrete actions to up-scale renewable energy.



Major Achievements in 2010



The main activities/ achievements under different programmes of the Ministry during the year 2010 are:

Jawaharlal Nehru National Solar Mission



One of the eight National Missions outlined in National Action Plan on Climate Change, the Jawaharlal Nehru National Solar Mission (JNNSM) specifically focuses on solar energy and its role in minimizing future emissions. The Government has launched JNNSM in January, 2010 with a target of 20,000 MW grid solar power (based on solar thermal power generating systems and solar photovoltaic (SPV) technologies), 2000 MW of off-grid capacity including 20 million solar lighting systems and 20 million sq.m. solar thermal collector area by 2022. The Mission will be implemented in three phases. The first phase will be of three years (upto March, 2013), the second till March 2017 and the third phase will continue till March, 2022.



Government has also approved the implementation of the first phase of the Mission (upto March, 2013) and the target to set up 1,100 MW grid connected solar plants including 100 MW of roof-top and small solar plants and 200 MW capacity equivalent off-grid solar applications and 7 million sq.m. solar thermal collector area in the first phase of the Mission, till 2012-13.

During 2010-11 the Ministry has selected grid solar power projects of 800 MW capacity. Six major R&D projects in solar thermal and photovoltaic technologies have been sanctioned. National Centre for Photovoltaic Research and Education has been set up at IIT-Bombay.



Off-grid Renewable Energy for lighting/ captive power & thermal applications



A new policy framework has been put in place for rapid up-scaling of off-grid programmes in an inclusive mode. The programmes are now being implemented through multiple channel partners including renewable energy service providing companies, financial institutions including microfinance institutions, financial integrator, system integrators, industry and programme administrators. In order to sustain satisfactory performance and generation of output in the envisaged energy forms, a flexible funding approach has been adopted with bouquet of instruments including support in the form of capital subsidy, interest subsidy, viability gap funding etc. This apart, Ministry provides full financial support for undertaking pilot and demonstration projects through manufacturers and other organizations for demonstrating new and innovative applications of renewable energy systems.



The greatest potential area of off-grid relates to solar technologies. These include solar water heating systems, home lighting systems comprising solar lanterns, solar cooking systems, solar pumps and small power generating systems. Under the Solar Mission, it has been proposed to cover 2000 MW equivalent by 2022 which includes all the above, except solar water heating systems for which there is a separate target of 20 million sq. meters. Within the off-grid component, there is a separate target of covering 20 million rural households with solar lights. This includes coverage under the Remote Village Electrification Programme where largely solar lighting is provided to villages where grid is unlikely to go and which is almost entirely funded by Central grants. In addition, in other areas, where grid is available but power supply is of erratic nature, solar lighting is financed through loans given through rural banks. These are very ambitious targets.



The Remote Village Electrification (RVE) programme aims at providing basic lighting/electricity facilities through renewable energy sources in those unelectrified remote census villages and remote unelectrified hamlets of electrified census villages where grid connectivity is either not feasible or cost effective. During March –December 2010, 300 villages have been electrified and 341 projects for electrification have been sanctioned. Households in around 7000 remote villages and hamlets have so far been provided home-lighting systems under this programme.



The National Biogas and Manure Management Programme of the Ministry mainly caters to setting up of family type biogas plants for meeting the cooking energy needs in rural areas of the country. During the year, 60,000 family type biogas plants have been installed upto 31.12.2010. With this the cumulative installation of 4.31 million family type biogas plants, about 35% of the estimated potential has been realized so far. Apart from setting up family type biogas plants, the Ministry started a new initiative from the year 2008-09 for demonstration of Integrated Technology package in entrepreneurial mode on medium size (200-1000 cum/day) mixed feed Biogas-Fertilizer Plants (BGFP) for generation, purification/enrichment, bottling and piped distribution of biogas. Ten such projects with aggregate capacity of 7700 cum/ day capacity have been sanctioned and are at different stages of implementation.



In order to utilize the micro hydel resources in remote hilly areas, the Ministry has been implementing a revised scheme for watermills and micro hydel projects upto 100 kW capacity. During the year, over 300 watermills have been setup/upgraded for mechanical/electrical outputs. In addition, over 2000 water mills and 60 micro hydel projects for meeting the mechanical and electrical needs of rural communities are at different stages of commissioning.



Solar water heating is a well established technology and has been in promotion in country for last many years. It is an important way of reducing electricity demand by replacing geysers in domestic houses. A total of about 3.8 million sq.m. of collector area for water heating has been installed so far as against an estimated techno-economic potential of 40 million sq.m. of collector area in various sectors. During the year, over 0.6 million sq.m. of collector area was installed. The major potential exists in the domestic sector though a significant potential also exists in commercial & industrial sectors. The new financial incentives introduced in the off-grid scheme announced under JNNSM will help taping this potential.


Solar concentrating systems, comprising automatically tracked of parabolic dishes, have been found to be useful for generating steam to cook food for hundreds and thousands of people in community kitchens especially at religious places such as Shirdi, Mount Abu, Tirupati etc. The world’s largest system is functioning at Shirdi for cooking food for 20,000 people/day. These systems have found good applications for air conditioning and laundry also and a few demonstration plants have recently been installed. A total of around 80 concentrating systems of different capacities covering 25,000 sq.m. of dish area are functioning in the country, largely for cooking purpose. During 2010, 15 such systems were sanctioned covering a dish area of around 3000 sq.m.



A new scheme on ‘Development of Solar or Green Cities’ has been launched to encourage and assist the Urban Local Bodies in assessing their present energy consumption status, set clear targets for upto 10% reduction in projected demand, and prepare action plans to generate energy through renewable energy sources and conserve energy utilized in delivering urban services. A mission approach is being attempted in this area of sustainable habitats.



Over 20 MW power generation projects from waste were set up during the year. In view of the availability of large quantities of food and kitchen wastes at places of community cooking/large kitchens and eating joints, a project for biogas production from such wastes was under implementation. These include energy recovery and power generation from industrial and commercial wastes, & effluents, and cogeneration. Industrial waste-to-energy projects with a total capacity of about 8 MWeq were completed during the year. In addition, about 30 MWeq projects are under installation.



Biomass gasifiers for thermal applications with a total capacity of about 20 MWeq have been installed in various industries such as bakeries, die-casting and food processing units. In addition, biomass gasifier systems with a total capacity of about 10 MWeq are under installation in various industries for thermal/electrical applications.



Grid-Interactive Power from Renewables



Over 2700 MW grid connected renewable power capacity was added during the year. It includes power from wind, biomass, small hydro and solar resources. Over 2000 MW wind capacity was added. Biomass power/ bagasse cogeneration capacity addition of over 400 MW was achieved. The cumulative biomass power/ bagasse cogeneration based power capacity has reached 2,550 MW. Cumulatively, 700 small hydropower projects aggregating to 2,850 MW have been set up in various parts of the country, of these over 300 MW capacity was added during the year 2010. Over 10 MW capacity grid connected solar power generation systems were set up during the year.



In January 2010, CERC issued a notification on ‘Terms and Conditions for recognition and issuance of Renewable Energy Certificate for Renewable Energy Generation’. Renewable Energy Certificate seeks to address the mismatch between availability of renewable sources and the requirement of the obligated entities to meet their renewable purchase obligation. The National Load Dispatch Centre (NLDC) has been appointed as Central Agency for implementation of RECs. This Central Agency has prepared detailed procedures for registration, accreditation, issuance, and redemption of RECs.



Special Projects

Electrification / illumination of all border Villages of Arunachal Pradesh

The Ministry is implementing a project for electrification/ illumination of the 1058 villages in border districts of Arunachal Pradesh. The implementation of the project started from 1st January, 2009 and will be completed by 31st March, 2012. The total cost of project is Rs.275.58 crore. Already 523 villages have been illuminated by SPV systems and 203 villages electrified from small/ micro hydel projects. A Steering Committee under the Chairmanship of Secretary, MNRE is monitoring implementation of the project.

Ladakh Renewable Energy Initiative

The Ministry has started implementation of a project entitled ‘Ladakh Renewable Energy Initiative’ to minimise dependence on diesel in the Ladakh region and meet power requirement through local renewable sources. The approach is to meet power requirements through small/ micro hydel and solar photovoltaic power projects/ systems and use solar thermal systems for water heating/ space heating/ cooking requirements. The project is being implemented in a time bound mode of three and a half years with a total cost of Rs.473 crore. The project envisages setting up of 30 small/ mini hydel projects with an aggregate capacity of 23.8 MW, SPV power plants in 70 villages, 120 health centers, education institutions/ schools etc. and 10 locations in defence establishments. The project also envisages installed of over 20,000 Solar thermal systems.

Biomass Gasification for meeting Rural Electricity Demand



Rice husk-based power-generating units in the villages of West Champaran district in Bihar have been lighting up around 500-700 households spread over 20 villages in the district, and changing the profile of the cluster altogether. The West Champaran experiment is supported by the Ministry and implemented by Husk Power Systems (HPS), an NGO. The technology employed is simple: It uses the husk-based gasifier technology to provide electricity using 32 kWe ‘mini power plants’ that deliver power on a ‘pay-for-use’ basis to households in the rice-producing belt of India. The price paid to procure electricity generated by these mini power plants is very low - Rs 2 per day per household, located within a radius of 1.5 km. The charges are such it results in a reduction in the consumption of kerosene by as much as two-thirds. Power is supplied from 5 pm till midnight each day. During the daytime, it provides power to 6-7 pumps for irrigating fields. Success of Bihar initiative has resulted in HPS planning to set up 20 more plants of 32 kWe generating capacity in Samastipur and Lakhisarai, besides more villages in West Champaran. Similar projects are being conceived of in eastern UP and parts of West Bengal.



Ministry of New and Renewable energy has now plans to take up the rice husk based electricity systems on a `Mission Mode’. The potential is enormous and even some of the large rice mills can feed power to the grid as well as distribute locally. More than 5,000 to 10,000 industries can be benefited in the next 2-3 years. These systems could result into diesel saving would be to the tune of 200-250 million litres annually.



Renewable power plants at tail-end of grid



In the larger perspective of grid power, this is a new area being experimented with in India. For solar PV, a total of 100 MW capacity is being set up with smaller plants of 100 KW to 2 MW, which are connected to grid through 11 kV feeder. It is expected that small plants would reduce the transmission losses by 5-7% with respect to large capacity plants of 50-100 MW size and improve both voltage and frequency at the tail end. It would also help in further transmission of electricity of electricity downwards. The same approach is being planned for biomass based power plants of upto 2 MW capacity too as the logistics of fuel management would become much more manageable and more environment-friendly.



Human Resource Development



Ministry has initiated a series of activities for meeting ever increasing human resource requirement in renewable energy area. These include award of Renewable Energy Fellowships for post graduate, M.Tech, doctoral degree and at the post doctoral levels; institution of Renewable Energy Chair at academic institutions, incorporating renewable energy in the main course curriculum of various engineering branches and mechanic trades; support to educational institutions for undertaking degree/diploma programmes in renewable energy; training programmes on different aspects of technology to renewable energy professionals working in State Nodal Agencies/Government/ Utilities, research & development institutions, NGOs, community based organizations, banking and financial institutions etc; organization of training-cum-study tours; and also developing of training modules for various category of professionals. The national renewable energy fellowship scheme has been augmented to provide fellowship to 400 students/researchers every year. To provide financial assistance to educational and research institutions to set-up infrastructural facilities such as laboratory, library and other teaching aids. In addition, Ministry has planned National Solar Energy Fellows Programme under which 10 eminent scientists will be awarded fellowship of Rs.1 million per annum, in addition to contingent and research grant. This apart, Renewable Energy Chair is planned to be instituted at 15 premier institutions. As such Ministry has launched a comprehensive programme to address human resources needs of different level of professionals and stakeholders.



Renewable Energy and Climate Change



Renewable energy is central to climate change mitigation efforts. Broad estimates indicate that mitigation from existing renewable energy portfolio is equivalent to around 4-5% of total energy related emissions in the country. Further, the vast market potential and well-developed industrial, financing and business infrastructure, has made India a favorable destination for Clean Development Mechanism (CDM) projects, with renewable energy projects having the major share. National renewable energy plans offer ample opportunity for CDM projects and technological innovations.



By October 2010, India had 534 registered CDM projects, which is around 22% of worldwide registered projects. With 347 projects, renewables constitute around 65% of Indian CDM registered projects. Within renewables, wind has the maximum number of projects with 119 projects followed by hydro 68 and solar only 3. Of these 3 solar projects 2 are photovoltaic and 1 is solar thermal (cooking) project. In addition, there was a CDM project pipeline of around 1200 projects, of which around 750 projects were from renewables.

Home Minister Invites West Bengal Chief Minister to Delhi

The Union Home Minister, Shri P.Chidambaram has received a letter dated December 28, 2010 from the Chief Minister of West Bengal.

Home Minister has sent two letters today in reply to the letter. Both letters have been faxed as well as sent by speed post.

In the concluding part of the first letter, Home Minister has invited the Chief Minister of West Bengal to Delhi, at his earliest convenience, to discuss the subject and agree upon the way forward.

Corporate Social Responsibility of PSUs

The guidelines on Corporate Social Responsibility for Central Public Sector Enterprises (CPSEs) issued by the Department of Public Enterprises, Ministry of Heavy Industries and Public Enterprises, lay stress on the link of Corporate Social Responsibility with sustainable development.

The guidelines define Corporate Social Responsibility (CSR) as a philosophy wherein organizations serve the interest of society by taking responsibility for the impact of their activities on customers, employees, shareholders, communities and the environment in all aspects of their operations. Under theses guidelines, the long-term CSR Plan is to match with the long-term Business Plan of the Organization. The activities under CSR are to be selected in such a manner that the benefits reach the smallest unit i.e., village, panchayat, block or district depending upon the operations and resource capability of the company.

Under these guidelines, CPSEs have to create, mandatorily through a Board Resolution, a CSR budget as a specified percentage of net profit of the previous year. Expenditure range of CSR in a financial year is 3-5% of the net profit of previous year in case of CPSEs having profit less than Rs.100 crores; 2-3% (subject fo minimum of Rs.3 crores) in case the profit ranges from Rs.100 crores to Rs.500 crores and 0.5-2% in case of CPSEs having a net profit of more than Rs.500 crores in the previous year. The CSR budget has to be fixed for each financial year and the funds would be non-lapseable. Special stress has been laid on the proper monitoring of the CSR projects undertaken. The Boards of the CPSEs would be responsible for the implementation of the CSR activity which would then be a part of the annual Memorandum of Understanding (MoU) signed between the CPSEs and the Government.

Index of Six Core Industries (Base: 1993-94=100) November– 2010

The Index of Six core industries having a combined weight of 26.7 per cent in the Index of Industrial Production (IIP) with base 1993-94 stood at 254.9 (provisional) in November 2010 and registered a growth of 2.3% (provisional) compared to 5.9% registered in November 2009. During April-November 2010-11, six core industries registered a growth of 5.0% (provisional) as against 4.5% during the corresponding period of the previous year.

Crude Oil

Crude Oil production (weight of 4.17% in the IIP) registered a growth of 17.0% (provisional) in November 2010 compared to a growth rate of (-) 1.6% in November 2009. The Crude Oil production registered a growth of 11.5% (provisional) during April-November 2010-11 compared to (-) 1.4% during the same period of 2009-10.

Petroleum Refinery Products

Petroleum refinery production (weight of 2.00% in the IIP) registered a growth of (-) 3.7% (provisional) in November 2010 compared to growth of 4.8% in November 2009. The Petroleum refinery production registered a growth of 0.8% (provisional) during April-November 2010-11 compared to (-) 1.2% during the same period of 2009-10.

Coal

Coal production (weight of 3.2% in the IIP) registered a growth of 0.7% (provisional) in November 2010 compared to growth rate of 4.7% in November 2009. Coal production grew by 0.6% (provisional) during April-November 2010-11 compared to an increase of 9.7% during the same period of 2009-10.

Electricity

Electricity generation (weight of 10.17% in the IIP) registered a growth of 3.3 % (provisional) in November 2010 compared to growth rate of 3.1% in November 2009. Electricity generation grew by 4.5% (provisional) during April-November 2010-11 compared to 5.8% during the same period of 2009-10.

Cement

Cement production (weight of 1.99% in the IIP) registered a growth of (-) 11.6% (provisional) in November 2010 compared to 9.0% in November 2009. Cement Production grew by 4.1% (provisional) during April-November 2010-11 compared to an increase of 11.0% during the same period of 2009-10.

Finished (carbon) steel

Finished (carbon) Steel production (weight of 5.13% in the IIP) registered a growth of 4.4% (provisional) in November 2010 compared to 11.7% (estimated) in November 2009. Finished (carbon) Steel production grew by 6.9% (provisional) during April-November 2010-11 compared to an increase of 2.9% during the same period of 2009-10.

N.B: Data are provisional. Revision has been made based on revised data obtained.

Water, crying for attention

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Even though the National Water Policy 2002 addressed the various issues pertaining to sustainable development and efficient management of water resources, the ground level action after eight years is short on results but long on roll-out of a multiplicity of programmes.

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On the water front, the writing on the wall is crystal clear with international institutions highlighting in recent years water-related issues and challenges in India's water sector and calling for timely action to recover the fast depleting resource that is a basic human necessity.

Latest in the litany of woes on the country's water front, after the World Bank and the World Economic Forum's lament, has come from the Manila-based Asian Development Bank (ADB).

In a a draft ‘Water Operational Framework 2011-2020' ADB stated that “the Bank will be challenged by the water stress that dominate large parts of Asia, manifest most clearly in countries such as China, India, Pakistan, Nepal, Bangladesh, Cambodia and Vietnam”.

It explicitly cautioned that water shortages are likely to aggregate 40 per cent in developing Asia by 2030 and that in some countries such as India demand will exceed supply by 50 per cent.

While the data gleaned by the ADB were from Water Resources Group, which estimated the aggregate 2030 demand and supply at 1,498 billion cubic meters (BCM) and 744 BCM respectively, the country's National Commission for Integrated Water Resources Development (NCIWRD) has assessed that “with the desired efficiencies, the water requirement by 2050 could be brought down to about 1,180 BCM in a high demand scenario.

It needs to be noted that the average annual water availability is estimated at 1,869 BCM.

The increase in population over the years has indubitably reduced the per capita availability. Whereas in 1951, the per capita water availability was 5,177 cubic metre a year, the per capita availability based on the population in 2001 census works out to be about 1,820 cubic metre a year.

As the 2011 Census findings will be known on April 1, the per capita availability of water would have definitely come down further.

As the Ministry of Water Resources has conceded that in view of the topographical constraints and hydrological features the utilisable water has been assessed to be about 1,123 BCM, NCIWRD projects the water requirement by about 843 BCM and 1180 BCM respectively provided the existing water resources are efficiently utilised.

Even though the National Water Policy 2002 addressed the various issues pertaining to sustainable development and efficient management of water resources, the ground level action after eight years is short on results but long on roll-out of a multiplicity of programmes and plan of actions purely as political gimmicks.

A House Panel report in April on inter-linking of rivers, deemed a crucial plank for providing a thrust to the whole water issue, has drawn attention to the fact that out of 30 identified links by the National Perspective Plan (NPP), the Detailed Project Report (DPR) for only one link, – the Ken-Betwa link – has been completed so far.

It said that though the DPRs for two other links, Par-Tapi-Narmada link and Damanganga-Pinjal link had been taken up in January 2009, the preparations of DPRs for remaining identified 27 links have not yet been taken up.

The nub of the matter is that though all the States had agreed to the inter-linking of river (ILR) programme in principle, problems did surface when it came to the brass-tacks and specifics of the issues of water sharing and other related benefits.

The long-pending Cauvery river water dispute between the riparian States of Karnataka and Tamil Nadu is only one instance of the intransigence, albeit the lofty proclamation of the National Water Policy that the water sharing/distribution among the States should be guided by a national perspective with due regard to water resources availability and needs within river basins.

Policy analysts say that ILR is only one component and there are vexatious developments such as the alarming rate of ground water depletion, lack of potable water to lakhs of poor villagers and pollution of major rivers by the dumping of industrial waste and other dregs.

Unless a national campaign to underscore conservation, spatial distribution across the country and recharging of water tables is evolved, the battle lines for water would get clearly drawn.

It is a sad reflection of the reality that only 12 States have adopted the State Water Policy with Delhi, Daman & Diu, Dadra & Nagar Haveli having pitched for the National Water Policy.

Critics warn that in the absence of a concerted move crafted by consensus to address the serious water problems plaguing the country, the warfare on water would break out before long, offering scant comfort to a high growth economy.

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XSTRATA CONTRIBUTES A$1 MILLION

TO QUEENSLAND PREMIER’S DISASTER RELIEF APPEAL

 

 

Xstrata has contributed A$1 Million to the Queensland Premier’s Disaster Relief Appeal to assist those communities affected by the devastating floods in Central Queensland, Australia.

 

Xstrata is a significant employer within Queensland and a major contributor to the region’s economic growth via its coal mines at Rolleston, Oaky Creek, Collinsville and Newlands.

 

Xstrata Chief Executive Officer Mick Davis said, “The communities close to our coal operations in Central Queensland located near Emerald, Collinsville and Springsure as well as our copper and zinc operations across Mt Isa and Townsville represent an important part of Xstrata’s global network and it is thus fitting for Xstrata to play a role in assisting the many residents who have been forced to evacuate their homes as a result of the rising floodwaters. The devastation of these floods has left many of our employees, their families and the surrounding towns and farming communities either homeless or severely impacted.

 

Our thoughts are with those affected and with the rescue and emergency services engaged in providing support on the ground.”

 

ArcelorMittal Extends Offer for Baffinland Iron Mines Corporation to January 10, 2011

Toronto, 29 December 2010 (11 pm EST) / Luxembourg, 30 December 2010 (5 am CET) - ArcelorMittal today announced that it has extended the time for acceptance of its offer (the "Offer") to purchase all of Baffinland Iron Mines Corporation's ("Baffinland") outstanding common shares ("Common Shares") at a price of C$1.25 in cash per Common Share and all outstanding common share purchase warrants issued pursuant to a warrant indenture dated 31 January 2007 (the "2007 Warrants") at a price of C$0.10 in cash per 2007 Warrant until 11:59 p.m. (Toronto time) on January 10, 2011.

ArcelorMittal is considering Nunavut Iron Ore Acquisition Inc.'s announcement earlier today that it has amended its partial offer for Common Shares.

ArcelorMittal will promptly mail a notice of extension of the Offer to Baffinland securityholders. Securityholders who have validly deposited their Common Shares and 2007 Warrants need not take any further action to accept the Offer. Shareholders who have not yet tendered their Common Shares and 2007 Warrants now have an extended period of time to do so in accordance with the terms of the Offer. In addition, Baffinland has advised ArcelorMittal that, as requested by ArcelorMittal, the Baffinland board of directors has waived application of Baffinland's shareholder rights plan effective as of 4:59 p.m. (Toronto time) on December 29, 2010.

ArcelorMittal has retained Georgeson Shareholder Communications Canada Inc. as information agent in connection with the Offer. Computershare Investor Services Inc. is the depositary for the Offer. 

Tea crop loss seen at 30 million kg this year

The country's tea production is likely to be lower by about 30 million kg (mkg) this year against last year's 979 mkg.

Addressing the annual general meeting of the Assam branch of the Tea Association of India (TAI) at Tezpur recently, Mr D. P. Maheswari, President of TAI, attributed the drop to crop loss of about 15 mkg so far in the Assam Valley alone, largely due to the incessant rain followed by pest attacks.

Barak valley

In some gardens, the crop loss was as high as 25 to 30 per cent, he said, pointing out that the gardens in the Barak Valley also suffered a loss of over 2 mkg.

While the gardens in West Bengal's Dooars and Terai regions recorded a marginal rise so far, the production in South India's gardens also was much behind than that of last year.

Exports

The marginal improvement in exports to 143 mkg till September, compared with 136 mkg in the same period a year ago was largely due to the improved performance by South Indian gardens, as exports by North Indian gardens remained more or less the same due to the crop loss.

He, however, regretted that the average price realisation from exports was far from encouraging, presumably because Kenya and Sri Lanka, the two other major suppliers , recorded a substantial improvement in production.

Referring to a hefty 80 per cent increase in land rent on tea gardens by the Assam Government in 2008 and that too with retrospective effect from 2003, Mr Maheswari appealed to the State Government to reconsider the decision.

STAY ORDER

The Government could not implement the decision as yet due to the court order, he said, emphasising that the Government should not only desist from enforcing the increased the rates retrospectively, but also reduce the extent of increase.

He also criticised the Assam Pollution Control Board's decision to “arbitrarily” increase its fees, as applicable to tea industry, nearly 10 times.

The TAI President expressed concern over the law and order situation in the State, and particularly referred to the sporadic incidents of abduction and killing of tea garden employees.

SECURITY ISSUE

Most gardens, therefore, were required to incur substantial cost to provide security to their employees, by engaging private security agencies recognised by the Government.

“We therefore pray to the Government to either fool proof security for our garden employees or reimburse of our cost on this account,” he observed.

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Year End Review – 2010 – Ports and Shipping



Steps to protect seafarers, acquisition of three new ships by SCI, setting up of four new lighthouses along with automation of 30 lighthouses, steps to set up National Maritime Complex, approval of Cruise Shipping Policy and declaration of new Waterways market the main activities of the Shipping Sector. The main developments were:
The capacity on major ports has increased from 574.77 million tonnes as on 31st March, 2009 to 616.73 million tonnes as on 31st March, 2010.
The Kolkata Port Trust completed the R&D Project on' Study of impact of Alluvial Meanders and Tributaries on Bhagirathi river' costing Rs. 19.88 crores.
In the port sector an agreement for development of Container Terminal at Ennore Port at a cost of Rs. 1407.00 crores was signed during June, 2010.
An agreement for construction of deep draft from one berth from Paradip Port at a cost of Rs. 597.35 crores was signed.
An agreement for construction of deep draft berth for handling coal on BOT basis at a cost of Rs. 479.01 crores at Paradip Port was signed.
The project on development of Mega Container Terminal at Chennai port on PPP basis at a cost of Rs. 3686.00 crores with a capacity of 4 million TEU's has been approved by the Government.
Construction and Development of two berths namely EU-I and EU-1A have been approved for Visakhapatnam Port Trust which will add a capacity of around 14 MTPA under PPP mode.



For the Protection of Seafarers the Government has approved the establishment of the Indian Marine Casualty Investigation Cell. The objective of the Cell is to undertake investigation into marine causalities such as groundings, sinking or collision of vessels or death or grievous injury omission reports of seafarers. The cell would be empowered to:

(i) To conduct investigation into causes of shipping causalities.

(ii) Co-opt experts for the conduct of causality investigations.

(iii) Depute persons within and outside the country for casualty investigation and other related matters.

(iv) Publish reports of finding of casualty investigation in so far as its causes are concerned.

(v) Participate in national and international forum for investigation of marine accident related matters.



To boost Cruise Shipping in the country, Cochin Port in Kerala, New Mangalore Port in Karnataka, Chennai and Tuticorin Port in Tamilnadu and Mormugoa Port Trust in Goa have developed or are developing dedicated passenger cum-cruise terminals.



Cochin Shipyards Limited, Kochi achieved an all time high Net Profit of Rs. 223 Crores for the year 2009-10 as compared to Rs. 160 crores for the year 2008-09. It declared dividend of 10% on equity shares and 7% on preference shares for the year 2009-10. The yard signed a contract for 4 Platform Supply Vessels for M/s. Seatankers Management Company Ltd. Cyprus on 3rd September, 2010. It signed another contract for construction of 20 Fast Patrol Vessels for the Indian Navy on 20 October 2010. During the year 2010 the shipyard delivered 7 Platform Supply Vessels to owners in USA and Western Europe.



In the sphere of Inland Water Transport (IWT) two terminals respectively at Bolghaty Island and Willingdon Island in Cochin Port Trust area to provide connectivity between NW-3 and International Container Transshipment Terminal (ICCTT), Vallarpadam have been completed. These terminals will have LO-LO (Lift on - Lift off) and RO-RO (Roll on -Roll off) facilities.

o NTPC has given commitment for transportation of 3 million tonnes per annual of imported coal from Haldi/Sagar/Sandheads to Farakka by IWT mode for at least seven years. A joint Committee of senior officers of IWAI and NTPC has been constituted to develop and implement this project on PPP mode. In this process an EOL was published in Aug, 2010 which evoked encouraging response from prospective investors and subsequently IWAI and NTPSC are finalizing RFP and other documents to invite bids.

o Under Kaladan Multi project for which Inland Waterways Authority of India (IWAI) is Project Development Consultant (PDC) for Ministry of External Affairs, the bids for construction of port and IWT portion were invited by IWAI on behalf of MEA and work has been awarded by MEA to an Indian Private agency M/s ESSAR Projects (I) Pvt. Ltd. in May,2010

o In May,2010 Addendum to Indo-Bangladesh Protocol on Inland Water Transit and Trade has been signed thereby incorporating Ashuganj in Bangladesh and Silghat in India as new Ports of Call.



Shipping Corporation of India(SCI) - The Government approved issue of fresh equity of 10% by SCI and sale of 10% by SCI and sale of 10% of the existing Government shareholding in the domestic market as per SEBI regulations. The issue opened on 30 November 2010 and was oversubscribed several times. Rs.582.364 crores was raised by SCI/Government of India each. With the recent follow-up public offer, Government of India’s holding in SCI has come down to 63.75% from the existing 80.12%.



SCI proposes to acquire 62 vessels during 11th Plan as part replacement of its vessels scheduled for phase out the end of their economic life and also to enhance its capacity. SCI has so far taken delivery of 16 vessels during 11th Plan period, out of which 9 vessels were delivered during the current year i.e. 2010-11. SCI has placed orders for construction of another 33 vessels. Finance for these acquisitions will be arranged through domestic or international borrowings and the balance amount will be arranged through internal resources and the recently concluded equity issue.



To further International Cooperation and to strengthen cultural ties and also encourage trade and commerce between India and Sri Lanka a Memorandum of Understanding (MOU) for commencement of ferry services between Tuticorin and Colombo and between Rameswaram and Thalaimannar has been finalized and the proposal for signing of the MoU has been approved by the Govenment. The proposed ferry services would ensure mobility of people and increase trade, tourism and development activities.



To provide Aid to Navigation Two New Lighthouses at Mallapatnam and Pumpuhar and one DGPS station at Rameswaram (All in Tamil Nadu Coast) have been established in the year 2010. Work order for National Automatic identification system to cover the entire Indian Coast line, which will help also in the surveillance of the Indian Coast Line, has been placed. An amount of Rs. 99 crore has been collected as Light dues during the year up to November, 2010.



In the Port Sector, during the year 2009-10, 13 PPP projects were awarded at the Major Ports envisaging an amount of Rs. 265377 crore and a capacity of 65.65 MTPA. In addition, 6 PPP projects have so far been awarded in the current year till December, 2010. This private investment will inject Foreign Direct Investment into the port sector and will result in creation of additional capacity in the ports.



Ennore Port Ltd.(EPL) : The project of Development of Container Terminal with 1.5 TEU's capacity and costing Rs.1407 crores, on BOT basis has been approved by the Government and an agreement was signed on 13th August, 2010.



In order to improve connectivity, 18.3 Km four-lane Elevated Expressway from Chennai Port to Maduravoyal on National Highway 4 has been approved by the Government recently. Chennai-Ennore Port Road Connectivity of 29.3 Kms length with an estimated project cost of Rs.309 crores is also underway. 4-laning of Tuticorin-Madurai Road (NH 45 B) with road length of 144 Kms at an estimated cost of Rs.629 crores has been sanctioned, work awarded and Financial Close achieved in January, 2007 and scheduled to be completed by 2010. Doubling of Madurai-Dindigul Section of railway line connecting Tuticorin Port of 62.06 Kms. Length with estimated project cost of Rs.126 crores has been sanctioned and the work has been awarded. Ambaturai-Kodaikanal road doubling has been merged with his work.



Chartering: During the year 2010 ( January-December, 2010), the chartering Wing made shipping arrangement for and on behalf of Government Departments and PSUs for Cocking Coal, Fertilizers, Crude Oil, Iron Ore, Lime Stone besides project cargoes of 198.43 lakh MT



Besides making shipping arrangements for movement of cargoes, Chartering wing chartered an ice Breaker and an Expedition Vessel for National Centre for Antarctic and Ocean Research for the 30th Indian Antarctic Expedition.



During the year Chartering wing collected one percent Chartering Service Charges amount to Rs. 1.45 crores (January-December)

Achievements and Initiatives of the Ministry of Mines for the Year 2010
Year End Review 2010





New Mines and Minerals (Development and Regulation) Bill, 2010



After several rounds of consultation and workshop with all Stakeholders, including Central Ministries, State Governments, Industry associations and NGOs, the Ministry has prepared a draft Mines and Minerals (Development and Regulation) Bill, 2010, duly vetted by Ministry of Law and Justice, to replace the existing Mines and Minerals (Development and Regulation) Act, 1957. The draft Bill seeks a complete and holistic reform in the mining sector with adequate provisions to address issues relating to sustainable mining and local area development, especially families impacted by mining operations. The Bill aims to ensure transparency, equity, elimination of discretions, effective redressal and regulatory mechanisms alongwith incentives encouraging good mining practices, which will also lead to technology absorption and exploitation of deep seated minerals. The Draft Bill is presently referred to a Group of Ministers under the Chairmanship of Shri Pranab Mukherjee, Hon’ble Finance Minster, and based on the recommendations of the Group of Ministers and Cabinet approval, the draft Bill would be placed in the Parliament at the earliest.



Revision of rates of royalty and dead rent in respect of major minerals (non-coal minerals)



As a result of the revision of royalty rates and streamlining of the guidelines for calculation of royalty, the royalty collection for major minerals in the country has increased from Rs. 2319.21 crore in 2008-09 to Rs. 3997.42 crore in 2009-2010. State-wise increase in the royalty collections is given in table below:



Royalty accrual for major minerals (excluding coal and lignite)

(in Rs. crore)
                                                                  State           Royalty

                                                                                       2008-09  2009-10 (P)

                                                                 Assam                 0.63        0.94

                                                  Andhra Pradesh            242.85   370.38

                                                                     Bihar                2.69         NA

                                                          Chattisgarh            153.89    474.39

                                                                Gujarat             157.86    250.00

                                                                    Goa                 27.46    285.91

                                                           Haryana                   0.06       NA

                                      Jammu and Kashmir                   2.93        NA

                                                        Jharkhand                 63.23    319.04

                                                         Karnataka               184.13     433.12

                                                              Kerala                     7.24        8.81

                                               Madhya Pradesh              191.42     351.49

                                                   Maharashtra                  107.42    85.10

                                                      Meghalaya                       NA        7.26

                                                              Orissa                  431.35    654.46
                                                        Rajasthan                  641.81    997.28

                                                        Tamilnadu                104.24     130.56

                                                               Total                   2319.21   3997.42




NA: Not Available

(P): Provisional

Source: Indian Bureau of Mines



Development of Human Resources for the Geo-Scientific Sector:-

The Final Report on Mapping of Human Resources and Skills for the Mining Industry in India commissioned by the Ministry of Mines and CII jointly has been prepared. The study has attempted sector wise future requirement of human resources in mining sector. The estimated increase in the mining production will lead to an increase in manpower from the present level of 0.9 million to 1.1 millions in the year 2017 and 1.2 million in the year 2025. Recommendation related to the educational initiatives on capacity additions to meet the projected demand of geoscientist, mining engineers is being posed to Ministry of HRD and for skill development to the National Skill Development Coordination Board, Planning Commission, Government of India.



SUSTAINABLE DEVELOPMENT FRAMEWORK – a human face to mining activities

Based on the report (2007) of the High Level Committee constituted by the Planning Commission to review the National Mineral Policy, which recommended for introducing best practices in implementation of environment management, the appropriate use of land within a land planning framework through a democratic decision making process on the basis of integrated assessment of ecological, environmental, economical and social impact; the Ministry engaged an expert consultant for creating a Sustainable Development Framework (SDF) for the mining sector. The consultant taking into consideration that mining should contribute to economic, social and cultural well-being of indigenous host populations and local communities by creating stakeholders interest in mining operations for the project affected people (PAP), has prepared a draft document and submitted to the Ministry. The next stage of consultations will be taken up by the Ministry of Mines involving also the concerned mining departments at the state level. A wider dissemination of the SDF will be undertaken before finalization and roll-out.



Preparation of Policy for a Five Year Strategic Plan for the Ministry of Mines



The Ministry of Mines is in the process of preparing a Policy document for a Five Year Strategic Plan for the Ministry.



National Mineral Policy, 2008



The Ministry of Mines has initiated several non-legislative measures based on National Mineral Policy 2008, such as re-assessment of threshold values of important minerals, increasing the spread of United Nations Framework Classification (UNFC) for minerals, developing mining tenement registry, zero-waste mining including cluster mining. In this new scheme of things, IBM has a very significant role to play.



INDIAN BUREAU OF MINES



In the wake of recent spate of illegal mining in different parts of the country, IBM has played a proactive role in curbing and controlling the menace. Indian Bureau of Mines constituted Special Task Forces for inspection of mines in endemic areas by taking the help of satellite imageries. Task Force-I, constituted for checking illegal mining in Karnataka, Andhra Pradesh, Orissa, Gujarat and Jharkhand have inspected 106 mines and recommended 60 mines for suspension. Another 4 mines have also suspended due to non-rectification of violations. Task Force-II, constituted for curbing illegal mining inspected 67 mines in Karnataka and 18 mines were suspended. In the second phase, 162 mines were inspected in Karnataka, Orissa and Jharkhand and 43 mines were suspended.



By a recent notification, IBM has been entrusted with the additional responsibility of granting of exploration license in the off-shore water of Bay of Bengal and Arabian Sea.



Considering the role and responsibility of IBM in the emerging scenario, a Committee has been set up in the Ministry for restructuring of IBM. The report of the Committee is under finalization.



Prevention of Illegal mining



Illegal mining is a bane to the entire mining sector as it leads to not only revenue loss but also encourages unscientific mining. Even though the State Governments, as the owner of minerals and vested with machinery for maintaining law and order, are empowered to take action, given the scale and nature of increase of the activity the State Governments have been finding it difficult to tackle this menace. With increasing incidents of the illegal mining being reported, the Central Government is collaborating with the State Governments to enable the use of modern technology like satellite imagery, geo-referencing of boundaries using GPS, transport regulation, compulsory registration of end-users, and constant monitoring of the endemic areas. To reinforce mechanism to control illegal mining, the State Governments were advised to:-



· Set up State Coordination-cum-Empowered Committee (SCEC) to coordinate efforts to control illegal mining by including representatives of Railways, Customs and Port authorities. Ten State Governments have set up a Coordination-cum-Empowered Committee. Twenty one States have set up Task Force at State and/or District level.

· Frame State Mineral Policy on the basis of model Mineral Policy drafted by the Ministry of Mines and to adopt transparent concession grant policies to reduce scope for illegal mining. Eighteen States have framed Rules under Section 23C of the MMDR Act, 1957.

· To adopt an Action Plan with specific measures to detect and control illegal mining including, use of remote sensing, control on traffic, gather market intelligence, registration of end-users and setting up of special cells etc.



Mainly because of the proactive stance taken by the Central Government on the issue, the following developments have been reported:



Recently, the Government has constituted a Commission of Inquiry under Shri Justice M.B. Shah (retired Judge of Supreme Court of India) to inquire into the large-scale mining of iron ore and manganese without lawful authority in several States of the country.



The Commission is expected to submit its report within 18 months of its first sitting.



MINERAL CONCESSION AND TRANSPARENCY



The Ministry of Mines has issued guidelines on 24.06.2009, 9.2.2010, 3.6.2010, 27.7.2010, 13.10.2010 with a view to bring uniformity and for transparent processing of mineral concession proposals and also to clarify the provisions of Mines and Minerals (Development & Regulation) Act, 1957 and the Rules framed thereunder.



The Ministry of Mines is using the internet services to bring about more accessibility and transparency in processing the mineral concession proposals recommended by the State Governments. The website of the Ministry (www.mines.nic.in) provides all information on the current status of the applications for mineral concessions. These services are being further enhanced to track the process from approval for grant to execution of concession agreement.



The Ministry of Mines has constituted a Central Coordination-cum-Empowered Committee on 4.3.2009 to monitor and minimize delays in grant of approvals for mineral concessions. The fourth meeting was held on 22nd December, 2010. All Ministries concerned, viz. Ministry of Environment & Forests, Ministry of Home Affairs, Ministry of Defence, Ministry of Steel, Ministry of Civil Aviation, Ministry of Shipping and Ministry of Finance and mineral-rich States participated in those meetings.



Revision Applications and Disposal



Ensuing quick disposal of Revision Cases, the guidelines on processing of cases have been issued. The revision software has been developed for processing and disposal of revision applications filed by aggrieved parties under Section 30 of the Mines and Minerals (Development and Regulation) Act, 1957 against grant refusal of mineral concession.



Initiatives taken by Geological Survey of India (GSI)



· To meet the emerging challenges, GSI is constantly upgrading its technology, both in the field and laboratory equipments. In this direction, (i) new ocean going research Vessel (at a cost of Rs.549.00 crores), (ii) Heliborne Geophysical Survey System (at a cost of Rs.52.00 crores) and (iii) Geotechnical Vessel with shallow drilling capacity (at a cost of Rs.70.20 crores) are being procured. A detailed modernization plan has been prepared.

· GSI is now employing extensive use of Information Technology for information dissemination through its Portal for general public at large, and geoscientific community in particular. Information technology is being widely utilized for monitoring progress of field and project activities, accessing unpublished project reports, publications (Records, memoirs) DIDS, District Resource Maps, Geological Quadrangular Maps, case histories, photo-gallery etc.

· GSI has taken up several programmes at the instance of state government agencies, PSUs and other stakeholders either in collaboration or to carry out on its own.



Restructuring of the Geological Survey of India



· Restructuring of GSI has gathered momentum and its five Missions and three Support Systems have integrated many dispersed wings into Regions, indicated improvement in HR position with higher rates of induction at JTS level. Improvement in quality in all processes, services and products through establishment of Quality Management Cell, framing of new Recruitment Rules to ameliorate career progression, firming up training and capacity building to organize training programmes for State, National and International candidates are new initiatives taken to name a few.



An Implementation Committee has been set up to go into the details for implementation of HPC Report and for further follow up of its recommendations.



National Aluminium Company Limited (NALCO)



· NALCO and the state owned Industrial Odisha Infrastructure Development Corporation (IDCO) have launched a Joint Venture company on 30th July, 2010 to set up an aluminium park at Angul to set up an aluminium downstream and ancillary complex.



· Environmental clearance for the Rs. 409 crore 4th stream Up-gradation project alumina refinery has been obtained from MoEF on 11th May, 2010 and consent to establish from Odisha State Pollution Control Board (OSPCB) was received under Water & Air Act in June, 2010.



· The 120 MW unit #10 of captive power plant has been synchronized with coal on 27th August, 2010. With the commissioning of unit #10, the capacity of CPP has been augmented to 1200 MW (10X120MW).



· For the on-going Rs 280 crore, 2 million tonnes per annum (MTPA) Utkal-E coal block project, approval of Govt of Orissa for Forest Dweller Certificate under provision of Section 6(5) of the ST & Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006 for forest clearance of Utkal-E coal mine project was issued on 25.06.2010, permission for drawal of water from Singharajhor for was received from Water Resource Department, Govt. of Orissa in June, 2010 and 7(1) notification for private land acquisition of 5 villages was issued in August, 2010.



· For taking up CSR activities in a focused manner with higher annual contribution from the Company, NALCO Foundation was registered under the Indian Trusts Act, 1882 in July, 2010.



· Bauxite Mines achieved the record performance of highest ever production since inception from existing facility with transportation of 48.79 lakh MT against previous best of 48.54 lakh MT (2005-06) with capacity utilization of 101.64% despite production loss of 30 shifts (15 days) on account of Naxal attack and shutdown of 31 shifts (15.5 days) due to drive rope replacement. The plant exceeded the rated capacity after a gap of 3 years.



· Alumina refinery achieved the record performance of highest ever production since inception from existing facility with alumina hydrate production of 15.915 lakh MT against previous best of 15.90 lakh MT (2005-06) with capacity utilization of 101.05%.





HINDUSTAN COPPER LIMITED (HCL)



· HCL has paid an interim dividend of 10% amounting to Rs. 46.26 crore on the paid-up capital of Rs. 462.61 crore on the 99.59% equity held by the Government of India in the company for the financial year 2010-11.



· The Cabinet committee in its meeting held on 15.06.10 has approved the disinvestment of 10% paid up equity capital of HCL out of Govt. of India’s shareholding along with issue of fresh equity of equal size (10%) by the Company in the domestic market.



· For improving power factor, Automatic Power Factor correction has been commissioned at ICC (Ghatshila, Jharkhnad) in September’10.



· HCL has allocated Corporate Social Responsibility (CSR) budget of Rs.40 Lakhs each for ICC and KCC, and Rs. 66 Lakhs for MCP for FY 2010-2011.





MINERAL EXPLORATION CORPORATION LIMITED (MECL)



· Proposal for exploration of high magnesium flux in Rajbasa block, Sundargarh District, Orissa at an estimated cost of ` 110.53 lakhs has been approved on 2.12.2010.



· Proposal for exploration of lead-zinc mineralization in Tikhi extension South block, Sawar Metasedimentary belt, district Ajmer, Rajasthan at an estimated cost of ` 239.76 lakhs has been approved on 2.12.2010



INTERNATIONAL COOPERATION (IC)



With a view to enhance cooperation between the two countries, the Ministry of Mines and the Department of Natural Resources, Canada (NRCan) signed a Memorandum of Understanding for cooperation in the field of Geology and Mineral Resources on 27th June, 2010, during the visit of Hon’ble Prime Minister of India to Canada.



Keeping in view the potential of Ontario Province of Canada, the Ministry of Mines signed a Memorandum of Understanding with the Ministry of Northern Development, Mines and Forestry (MNDMF), Ontario Province, Canada, for cooperation in the field of Geology and Mineral Resources on 8th July, 2010.



To enhance cooperation with the African countries envisaged in the India Africa Forum Summit held in April, 2008, the Ministry of Mines and the Ministry of Mineral Resources and Energy of the Republic of Mozambique have entered into a Memorandum of Understanding on 30th September, 2010, and with the Ministry of Natural Resources Energy and Environment Republic of Malawi on 3rd November, 2010 for cooperation in the field of Mineral Resources and geology .



To enhance cooperation with the mineral rich Mongolia a Joint Working Group (JWG) on Geology, Mines and Minerals between India and Mongolia was set up and the first meeting was held on 7-9 June, 2010 at Ulaanbaatar.



The Ministry of Mines and Toronto Stock Exchange (TSX) organised an interactive session on ‘Investment opportunities in the Mining & Energy Sectors through Toronto Stock Exchange (TSX)’ on 29th October, 2010, a New Delhi.