KOLKATA (miningweekly.com) - India’s Supreme Court on Monday rejected the Steel Ministry’s plea to increase the limits imposed on iron-ore mining from mines currently operational in the southern Indian province of Karnataka.

The Steel Ministry had moved the apex court to seek the relaxation of the current cap of 30-million tonnes a year to 50-million tonnes a year in view of the shortage of ore faced by domestic steel producers.

The Supreme Court did not accept the plea on the grounds that the Steel Ministry’s application in effect sought a review of the apex court verdict of April 2013, which had fixed a quantitative cap on mining of iron-ore as a precondition for the resumption of mining operations in Karnataka.

In 2011, the Supreme Court imposed a complete ban of iron-ore mining in the province based on reports prepared under its supervision by the Central Empowered Committee, which substantiated allegations of widespread illegal mining across all mines.

In an order in April 2013, the apex court permitted resumption of operations in 117 mines with minor violations (Category A/B), cancellation of leases in the case of 49 major violators (Category C) and fresh issue of mining leases for these assets subject to the overall annual quantitative restrictions.

The court order would also jeopardise the provincial government’s plans to put 51 mines on the auction block, the mining licences of which had been cancelled owing to illegal mining operations.

These 51 mines had been put under Category C by the court order or charged with low levels of illegality for carrying out mining of between 10% and 15% beyond leasehold areas.

The provincial government had planned to bring back an additional 15-million tonnes a year of ore production through resumption of these mines to new leaseholders, albeit for only captive consumption by successful bidders. However, government officials said that it was not yet clear whether bringing back these mines into operation would result in exceeding the 30-million-tonnes-a-year production cap from all mines that would be operationalised over a period of next few months.

According to data from the Indian Bureau of Mines, Karnataka accounted for 12.3% of India's iron-ore reserves of 28.52-billion tonnes. Prior to the ban on mining in the province imposed by the court, total iron-ore production from Karnataka was pegged at around 26- to 30-million tonnes a year.

Meanwhile, in a related development and in another case, the Supreme Court directed the federal government to set up a national regulator to deal with all mandatory environmental-impact assessments (EIAs) for forest-related projects, including mining projects.

The apex court has sought the establishment of a national regulator by the end of March 2014, with branches across all provinces for dealing with all EIA and project approvals.

The federal government has opposed a new national regulator on the grounds that apart from the Environment and Forest Ministry, the government had also set up a National Green Tribunal to deal with all forest-related issues of mining projects. Its opposition, however, was rejected by the Supreme Court.