NGO’s Opposition to Utilization of Mineral Funds for Covid relief Does Not Augur well with Regulators

“No money should be transferred out of DMF for purposes other than the needs and requirements of persons affected by mining in mining areas”, said Claude Alvares, founder of the NGO.

Goa Foundation, an NGO known for filing petitions in the courts against the mining and tourism industries, and responsible for stoppage of mining in Goa, has come out in opposition of the use of District Mining Foundation (DMF) Fund and the Goa Iron Ore Permanent Fund (GIOPF) by Goa government for coronavirus relief efforts.

There is a staggering sum of Rs. 23510 crore lying unused in the DMF Funds nationally as on Jan 2020. Finance Minister Smt. Nirmala Sitharaman on March 26, 2020 urged the state governments to utilise these funds to supplement and augment healthcare facilities, screening and testing requirements and any other resources that might be required by the state governments.

If Goa Foundation is able to have its way, this corpus can be denied to the country’s citizens at a time when the nation is going through an acute calamity and financial resources are the only hope for survival and revival.

In a letter written to the Chief Secretary of the State of Goa, the Goa Foundation Director, Shri Claude Alvares, has threatened to report the matter to the Supreme Court citing that “No moneys should be transferred out of DMF for purposes other than the needs and requirements of persons affected by mining in mining areas”. Citing various rules and court guidelines the NGO suggests that these funds should be used strictly as per the defined statues without any regard to emerging needs and societal consideration. The NGO calls moves by the State Government to use these funds for COVID relief work as an attempt to “raid the financial resources of the District Mineral Foundations and the Goa Iron Ore Permanent Fund” and that “these are absolutely illegal decisions and acts of the Goa government”.

In Goa, there is a sum of Rs. 184 crores and another Rs. 399 crores that have been lying unused in the DMF and GIOPF funds respectively for the last five years in Goa. Despite all the persuasion of the community stakeholders, these funds have not been utilized because of various reasons.

If Supreme Court was to agree with the views of the Goa Foundation, the mineral states across the country shall be deprived of the opportunity to utilize Rs. 23510 crore for relief and rehabilitation efforts.

Goa Government and the Chief Minister Shri Pramod Sawant have been fighting hard to keep the state finances going ever since the mining was stopped on the order of the Supreme Court in March 2018. It took Rs. 7000 crores straight out of the state GDP overnight. Goa’s economy is totally dependent on revenues from two primary sources – tourism and iron ore mining. Tourism the world over has been badly impacted by the COVID 19 outbreak and tourists are not likely to return soon to Goa. The government has also stopped all tourism activities for the next 3 months as a transmission containment effort. In a press conference on April 13, 2020, CM Sawant did clarify, “the state government is abiding by the appeal made by the Central Government.”.

The mineral funds can provide temporary and immediate relief to states in carrying out relief work. The idea of setting up of DMF Funds was to provide targeted resources for beneficial projects in the mining areas and benefit people living in such areas. The funds can be used for health, education and other social infrastructure. Also, the Minerals Act specifies that 60% of the funds should be used for priority areas while the remaining can be used for non-priority areas. There is therefore a discretionary provision in the law itself.

Minister Cabral clarifies, “the mining belt in the state of Goa covers almost 70% of the population and I do not see why the Government should not spend this money for the well-being of the communities.”

Minister Cabral’s disappointment is further visible when he says that “the Goa Foundation should work in the favour of Goans and not against in the present pandemic situation. If they are so much concerned, they should get some funds for the needy instead of posing challenges.”  

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