core sector communique

Royalty on Coal Revised

As per the recommendations of the Study Group, constituted by the Ministry of Coal for revision of royalty rates on coal and lignite, the Government has decided for adoption of ad-valorem regime, in place of present hybrid formula for charging royalty on coal and lignite, as demanded by the coal bearing States. According to the Gazette Notification No.GSR 349(E) dated 10.5.2012, published by the Government in this regard, royalty on coal and lignite have been revised @ of 14% ad-valorem and 6% ad-valorem respectively. This information was given by the minister of state for coal, Shri Pratik Prakashbapu Patil in a written reply in Rajya Sabha today. The Minister said that the above Study Group held extensive deliberations on the issues involved and held consultations with all the stakeholders which included the State Governments (both coal/lignite producing as well as consuming States), the concerned Ministry/Departments/Organizations of the Central Government, major coal consumers e.g. NTPC, SAIL, cement manufacturers, Industry Associations and Coal producing companies. As per the estimates, the royalty revenue earning of major coal producing States would increase on an average upto 17.31% for coal and 14.53% for lignite. Based on present production level the revenue from the royalty on coal and lignite will increase to Rs.6980 crores from Rs.5950 crores, being earned at erstwhile rates, resulting in increased combined earning by more than Rs.1050 crores.