NC’s mining report criticizes government mismanagement

The report also advised that issuances of mining licenses be frozen till issues are resolved

The National Council (NC) in its comprehensive mining report says existing mines and quarries are not regulated and managed to optimize equitable public socio-economic benefits and also lack environmental soundness.

This was one of the key conclusions of the study report presented by the NC’s Natural Resources and Environment Committee (NREC) on mines and quarry activities in the country to the house, earlier last week.

The NC has provided a host of recommendations, advising the government on better management of the country’s mining sector.

The study which was commissioned to the Royal Society for Protection of Nature (RSPN) by the house states that in the absence of a proper regulatory mechanism, it was outside the government’s knowledge on what type and quantity of mines were being extracted and exported.

“Mineral resources are the property of state and its use shall be regulated by law. While mining undoubtedly contributes to socio-economic development of a country, the exploitative nature of activity results in inevitable damage to environment. The non-renewable nature of the industry may not bode well for the country’s policy of sustainable development,” said NC MP Tshering Dorji.

The study states “while the law emphasizes national ownership of natural resources, the current mechanism for mining or quarrying do not represent direct optimal public benefit from mining sector. Instead benefits are largely individualized. Company shares are also limited primarily to promoters and the share of the  public is small.”

68% of businesses were found to be individually owned and the rest meager portion owned by shareholders. Which means the sector today, is seen as poorly monitored, extremely lucrative and in the hands of a few.

Talking to The Bhutanese, NC MP Sangay Khandu said levies, fees and taxes must be revised or the government should take complete control of the sector. “As far as I am concerned, if the natural resources are going to be exploited, every bhutanese should benefit from it for it is the country’s resource. If that is not the case, it is better we don’t have the mines,” he said.

The committee’s chairperson, Mani Kumar, said the first article of the constitution bestows the government the right and control over the country’s natural resources.

The house recommended that the government be it the incumbent or the next, prioritize on conducting detail geological mapping of the country before embarking on further mining and quarrying activities and delineate clear responsibility among various agencies involved in leasing, monitoring and supervision of mines and quarries and hold them accountable for lapses.

Other recommendations included revisiting the existing policies, legislation, guidelines, standards for licensing, operation and management to ensure that the mining and quarrying is operated as per the provision of the laws. It is also recommended to carry out cost benefit analysis and socio-economic and environmental impact of mining and quarrying.

Citing an example of the Talc mines which are not restored as required by law, the house urged that the government review the effectiveness of environmental restoration measures currently under practice. “If any company or individual leaves the mined area without restoring it, the burden falls directly on the government and indirectly on the general public.”

Council members also said it is important that all the recommendations and measures necessary to carry out mining activities in line with the middle path strategy and intergenerational responsibility as enshrined in the NEPA 2007 be included in the next annual report that National Environment Commission Secretariat. The NEC report is mandated to be produced in order to inform the National Environment Commission and public at large as per the law.

The house recommended a freeze in issuing mining licenses till the above issues are resolved.

The Minister for Agriculture and Forest, Dr Pema Gyamtsho said while he appreciates the NC’s concerns, the house must follow due process such as coming up with a bill or an amendment proposal to facilitate legislation. “They must consult the people to ensure smooth implementation of any policy or law,” he said.

Currently, there are 28 mines and 46 quarries operational in the country which covers around 0.04 percent of the country’s total area.

Today the mining sector’s revenue contribution to the government accounts for 1.26 percent of the national revenue (Nu 220M) collected in the form of royalty payment, mineral rents, license fee and surface rent.

Questioning the economic value of the mines the report concluded that more mineral resources are exploited today to generate the same value of money that was generated years ago even after factoring in inflation.

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