Activists hail India’s new mineral policy

5 Apr 19

Campaigners in India are hailing what they believe is a key step towards safeguarding “intergenerational equity” in a new national policy on minerals.

The National Mineral Policy 2019 agreed by the government in March redefines natural resources, including minerals, as a “shared inheritance” managed by the state as a trustee on behalf of citizens.

Advocacy groups that have been lobbying for the move such as the Goa Foundation and The Future We Need say it will help protect natural resources such as mineral wealth for future generations by offering concrete grounds for advocacy and public interest litigation.

The National Mineral Policy 2019 (NMP2019) acknowledges “natural resources, including minerals, are a shared inheritance where the state is the trustee on behalf of the people to ensure that future generations receive the benefit of inheritance”.

A review was ordered by India’s Supreme Court to replace the existing policy dating from 2008 and came amid debates about the need for measures to ensure intergenerational equity – fairness for future generations through the conduct of activities in the present.

The new mineral policy establishes that India’s states are trustees, not proprietors, of mineral wealth and must, therefore protect the resource and ensure that it is not wasted.

This will be achieved, for example, through a variety of caps on extraction to ensure future generations have access to mining income and limit environmental damage.

The International Public Sector Accounting Standard Board (IPSASB), meanwhile, has been discussing a new standard on natural resources.

The Goa Foundation has lobbied for accounting changes to correct what it claims is an error in treating royalties as “income” instead of as the extraction of mineral wealth.

It said in a statement, The Future We Need said: “At present, governments incorrectly treat royalties as ‘income’. Politicians love it – ‘easy money’ which can be used to retain power. Naturally, minerals are extracted at a faster and faster pace. In reality, minerals are usually sold for very large losses.

“Proper accounting would disclose these capital losses as government expenses. Politicians would have to explain to voters why they are selling the family silver for a pittance and consuming the proceeds, leaving nothing for future generations.”

  • Gavin O'Toole, expert on Latin America
    Gavin O'Toole

    A freelance journalist. He has written six books about Latin America and taught the politics of the region at Queen Mary, University of London.

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