Thursday 13 December 2018

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Economy | Mining

Will mining get revenue of Rs 500 crore at least the next financial year?

 

Will the mining sector get its estimated revenue next year to make the budget of Chief Minister Laxmikant Parsekar realistic or will it be a blunder to be committed once again?

“We are confident of getting the estimated revenue this time. Last year’s case was different”, claims Parsekar.

The wrong estimates from the mining sector last year pushed Goa into actual deficit of Rs 1000 crore when Parsekar had projected a surplus budget of Rs 478 crore.

Once again, Parsekar has projected a surplus budget, this time of Rs 159 crore, with estimated revenue of Rs 438 crore, especially from mining royalty.

Goa gets royalty paid on the export of iron ore.

Last year’s figures were projected based on a contemplation  that at least 10 out of 22 mines would start, when actually not a single mine started extracting ore.

Against its estimated receipts of RS 741 crore in last year’s budget, the actual revenue was hardly Rs 204 crore, almost one fourth of what was estimated.

“I am hopeful that all the mines, except those in the buffer zone and on the river banks, would start exporting the ore”, Parsekar told the media today after presenting the budget.

He has projected revenue of Rs 438 crore, largely from the royalty on exports, since the union finance minister Arun Jaitley has fully exempted the export duty on the low grade ore Goa exports.

 

Parsekar followed the suit, announcing in his budget speech 90% reduction on various fees like annual processing fees, registration fees for transport contractors, registration fees for every truck, registration fees for barge or machinery, sale and export permit for iron ore, transit permit for iron ore and transit permit for overburden.

He has also exempted levy of cess under the Goa Rural Improvement and Welfare Cess while continuing exemption of fees and taxes for truck and barges used for mining operation, on pro-rata basis.

But the million dollar question is whether the private lease holders of mines would start extracting iron ore and export it when the prices of Goa’s low grade ore have dipped historic low in the international market.

Besides Rs 438 crore, Goa government is also expecting almost Rs 100 crore revenue from VAT, which takes the figure on mining revenue to Rs 538 crore.

If this does not happen, then we may see yet another surplus budget of Laxmikant Parsekar becoming a deficit budget.

With petrol prices rising the same day he presented the budget, Goa is expected to lose VAT of around Rs 35 crore on petrol since he has promised not to hike the price of petrol above Rs 55 per litre.






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