The Ministry of Mines has proposed that inhabitants of mining areas, who often get almost no compensation when displaced from their lands, should be made stakeholders of the mining projects in their areas.

The Ministry has proposed that companies that receive a mining lease will from now have to mandatorily make people residing in the project area stakeholders. Companies will need to offer at least 26 per cent shares through the promoter’s quota.

According to the proposal mining companies will have to respect the rights of the local residents and suitably compensate them by legally binding the leaseholder to allot free shares equal to 26 per cent in the company to the locals.

The ministry has also mandated that mining leaseholders “provide employment or other assistance as per the rehabilitation and resettlement policy of the concerned State government.

The identification of affected families will be done by the State government through the Gram Sabhas or panchayats or district councils, before the mining operations start, and the onus will be on the leaseholder to ensure appropriate benefits reach the identified families.

Seems to be a good intention. But activists and NGOs have their doubts. Terming it a sugar coated bitter pill, they have equated it with public bribery for displacing people and destroying environment.