In 2 years, Rs 5,800 crore collected

Report also finds that there are shortfalls on various fronts, from institutional and administrative issues, to planning and budgetary allocations

• DMF instituted in March 2015 under the Mines and Minerals (Development and Regulation) Act, with the aim of giving mining-affected people in India a share in the benefits from mining

• Has the potential to pull India’s poorest districts out of their depths of poverty, by kick-starting much needed development and services delivery in them

• CSE has surveyed 50 key mining districts in the country, spread across 11 states

• The collected total of Rs 5,800 crore is not from all the mining districts – hence, the potential corpus is still higher, as in certain states such as Tamil Nadu and Uttar Pradesh DMFs are yet to be rolled out

• Odisha, Jharkhand and Chhattisgarh alone account for close to 70 per cent of total money deposited in DMFs so far

• Drinking water is a common issue that has been considered ‘high priority’ by majority districts. Education and healthcare are two others that districts have considered, though for all these allocations and approaches vary

• The allocations at various instances are ad hoc and short-sighted. In many districts, the DMF plans mechanically list the number and types of works to be undertaken, without any elaboration on the rationale of planning

• In the first year of planning, the districts are also inclined to allocate significant amounts for various construction purposes

• The administration is dominated by government officials with poor representation of people. DMFs are functioning without a fixed administrative set-up, such as an office for planning and co-ordination, relying on intermittent meetings of the DMF body

New Delhi, June 8, 2017: “DMF is a defining opportunity to overturn the decades of injustice meted out to the thousands of people living in deep poverty and deprivation in India’s mining districts,” said CSE deputy director general Chandra Bhushan, releasing the Centre’s latest study on the status of District Mineral Foundation here today. 

Established as a non-profit Trust, DMFs in every mining district have the precise objective to work for the interest and benefit of persons and areas affected by mining related operations. The CSE report is an independent review of the progress and performance of DMFs in various mining districts of India. 

Major highlights of CSE’s status report

• The report has surveyed 50 key mining districts in the country, in 11 states. It has done extensive analysis of DMF Plans of nine districts in four top mining states – Chhattisgarh, Odisha, Jharkhand and Madhya Pradesh. 

• About Rs 5,800 crore has been collected under DMF Trusts in various mining districts in a two-year period. The potential corpus is still higher, as in certain states such as Tamil Nadu and Uttar Pradesh DMFs are yet to roll out.

• Odisha, Jharkhand and Chhattisgarh alone account for close to 70 per cent of total money deposited in DMFs so far.

• The highest collections have come from the coal-mining districts.

• In some big mining districts such as Yavatmal of Maharashtra, Guntur of Andhra Pradesh, and Khamman, Adilabad, Karimnagar of Telangana, the collection so far has been much less than estimated.

• Of the 50 districts surveyed, 24 indicated that their DMF plans are ready. However, actual plans were available from only 17 districts.

The truth about allocation

The DMF plans which CSE has analysed broadly indicate allocations made to various sectors. The analysis has found that supply of clean drinking water is a common issue that has been considered ‘high priority’ by a majority of the districts. Education and healthcare are two other issues  that districts have considered, though for all these allocations and approaches vary. 

“Dhanbad, one of the highly polluted coal mining districts of Jharkhand, has allocated 62.5 per cent of its DMF budget for clean drinking water, which the district largely plans to provide through piped water supply. On the contrary, Singrauli, the top coal mining district of Madhya Pradesh and a critically polluted area, has earmarked a negligible 0.9 per cent of its DMF budget for drinking water which entirely is for digging tube wells,” said Srestha Banerjee, programme manager, environmental governance-community support programme, CSE.

What comes out is that while most of the districts have made allocations for certain “high priority” issues as identified under the respective state DMF Rules, the allocations at various instances are ad hoc and short-sighted. In many districts, the DMF plans mechanically list the number and types of works to be undertaken, without any elaboration on the rationale of planning.

The report finds that in the first year of planning, many districts have allocated significant amounts for various construction purposes. For instance, on the education front, with few exceptions, the big focus is on construction of structures such as school buildings, auditoriums and classrooms. There is very little focus on providing supporting resources that can improve access to and quality of education. 

Similarly, for women and child welfare, the focus is primarily on construction of Anganwadi Centres. There is little or no simultaneous investment in primary healthcare, which is crucial to improve health and nutrition status of children and women. In fact, in most districts, investments towards improving primary healthcare remain very low, though this is a pressing problem in all rural mining areas.

And while most districts have identified the DMF body, which includes members of the Governing Council and Managing Committees, the administration is dominated by government officials with poor representation of people. In addition, DMFs are functioning without a fixed administrative set-up, such as an office for planning and co-ordination, relying on intermittent meetings of the DMF body.

Evidently, there are shortfalls on various fronts, from institutional and administrative issues, to planning and budgetary allocations, which the districts need to act on. Said Bhushan: “We should, however, bear in mind that as DMF now enters the third year of its implementation, it is time to look forward than looking back. Two years in implementation of a national programme is not a time to judge. However, an analysis at this juncture can help to understand the course that DMFs are following, and enable districts to adopt measures that optimise the potential of DMFs in the coming years to serve the best interest of the people.”

About DMF
DMF was instituted in March 2015 under India’s central mining law, the Mines and Minerals (Development and Regulation) Act (1957). DMF has also been aligned to an important scheme of the Government of India, the Pradhan Mantri Khanij Kshetra Kalyan Yojana (PMKKKY) that was launched in September 2015. According to the provisions of DMF, miners and mining companies are required to pay a sum to the DMF Trust of the district where the mine is located. This sum is determined on the basis of their royalty payments.

The fund is clearly a bounty for some of India’s poorest and under developed districts, many of which are in the country’s top mining states. In India’s top three mining states – Odisha, Jharkhand and Chhattisgarh, nearly 40 per cent of the people live below the poverty line. Various districts in these states, also identified as backward districts by the Niti Aayog, fare very poorly in terms of various human development indicators such as nutrition and health, mortality rate, access to clean water, sanitation and education, among others.

With a huge non-lapsable and an untied resource cover, clear objectives guiding the implementation, targeted beneficiaries and focussed intervention areas, DMFs hold a huge promise to address years of deprivation and inequality afflicting people living in India’s mining areas. “The Government had rightly observed that DMF and PMKKKY are ‘revolutionary’ steps. However, the success of this move now lies in its relevance to, and participation of the people, and the transparency and accountability mechanisms through which the institution operates in the coming years,” said Bhushan.

CSE’s recommendations

There are three important aspects that need to be addressed with respect to DMFs – institutional and administrative gaps, planning and budget allocations and a scientific approach to the planning process:

• Set up DMF offices for activities like coordination, planning, monitoring and accounting – with full-time staff. There should also be an active engagement with subject experts and line department officials.

• Register all DMF Trusts.

• Each mining district should provide all information related to DMF on specific websites for the purposes of transparency and accountability.

• Focus on improving livelihood opportunities in mining affected areas, particularly around local resources.

• Set aside money for future security. Mining areas often suffer from the problem of becoming ‘ghost towns’ once mining ends. This should not be the case now that DMFs are in play.

• Determine the focus areas of intervention and prioritise issues through proper scientific assessment, taking into account the views of mining-affected communities.

• Undertake scientific and comprehensive planning to address immediate as well as long -term needs and provide future security. 

• Perspective planning must be undertaken to address immediate and long-term needs and sustain investments.

• DMFs can converge and integrate with other schemes of the Centre and state governments. This should however, be done only after thorough assessment of gaps.

• A bottom-up planning process must be followed by involving Gram Sabhas as per the mandate of the law. 

• A copy of the report is available here>>

 For further information on the release of the DMF Status Report please contact Hemanth Subramanian, CSE Media Resource Centre; 9836748585; hemanth@cseindia.org