Assam's Zero Transit Pass for Minerals: A Policy Gone Awry?

Assam Chief Minister’s Public Relation Cell on 14^th August 2021 quoted the Chief Minister Himanta Biswa Sarma as saying, “Ways must be explored to harness and utilise minerals outside forest areas for earning revenue by the Department. Extracting minerals outside the forest areas without causing harm to the environment must be prioritised by the Forest Department.” Revenue generation through streamlined management of Schedule-Y minor minerals by the Assam Forest Department has been a recurring theme in the Chief Minister’s speeches, including the Budget Speech of 2024-2025.

This meant curbing of illegal extraction of Schedule-Y minerals, and plugging the avenues for corruption in the Assam Forest Department during their extraction and transit. The Assam Minor Mineral Concession Rules, 2013 hitherto had provisions for four different kinds of arrangements for extraction of Schedule-Y minerals namely, lease, contract, permit and Government permit. Under each of these arrangements, advance royalty was required to be paid at the source to the department by those intending to extract minor minerals.

Corruption happened not only in the form of illegal extraction, but also through under-quantifying and under-valuation of the extracted minerals in collusion with the departmental officials. This became an industry in itself, spawning multi-crore syndicates.  Every day, one could see long queues of trucks loaded with Schedule-Y minerals without number plates in the suburbs of Guwahati city, waiting to enter the city at the fall of night, supplying sand and stone for the construction activity in the city.  At least a few who were involved claimed that they were “Dadar Manuh” (CM’s men).

The solution for this could have been stricter vigil at source, and rigorous checks in the transit.  But lack of staff was shown as an excuse.

Then came the iconic speech of the Chief Minister  on 7^th July 2021during the Van Mahotsav function at AIIMS, Guwahati which can be described as the beginning of, “what do we care where does it comes from?” policy of the Government of Assam.  Himanta Biswa Sarma famously said, “Let it come from Arunachal Pradesh or Moon! Let it be legal or illegal. How does it matter to us? We will collect the royalties at the point of consumption!” Thus came into being the concept of “Zero Transit Pass,” i.e., Transit Pass for Schedule-Y minerals which can be obtained without payment of advance royalty.

On paper, it looked like a good idea. Government Notification dated 7^th October 2021 ensued, bringing into existence the Assam Mineral Concession (Amendment) Rules, 2021.  The new rules provided for collecting royalties as per the rates prescribed in their Third Schedule. Royalties are to be collected at the time of payment of bills to the contractors and suppliers by the Government departments.  The amounts to be collected have been fixed as a percentage of the total project cost.  For example, for the construction of an RCC Building, 2% of the total project cost is to be collected as royalty by the PWD (Buildings).  For the new road construction, 6% of the total project cost is to be collected by the PWD (Roads).  The royalty amounts shall be deposited either through treasury or into the bank accounts pre-notified for the purpose by the Assam Forest department.

The new system took some time to sink in.  Officials were initially oblivious to the change.  This made the Chief Minister himself to summon forest officials, district administration and the treasury officials on 28^th July 2022, where they were taken to task regarding poor revenue collection from minor minerals. This brought some momentum, and the Assam Forest Department’s 2022-2023 revenue collection eventually reached Rs.449.96 Crores, which was still a far cry from the Rs.1,600 Crores revenue collection anticipated through the amended rules.

The new system also posed several new challenges at the field level.  Collection of royalties at the point of consumption meant that the DFOs should have access to an online portal where all the projects falling within their jurisdiction along with project costs are registered. Such a portal would list out projects run by the State and Central Governments, including Externally Aided Projects and Missions. AMTRON, a PSU of the Government of Assam, does run one such portal as on date.  But the said portal is besotted with problems as reported by several project authorities who are reluctant to register.

This means that the DFOs should have enough muscle and manpower to enforce registration in the first instance, and then make the project authorities pay royalties as stipulated in the AMCR, 2021, which is often not the case.  For example, one DFO lamented as to how the Indian Army undertakes its construction projects without bothering to register on the portal.  Several projects funded through CSR funds are amongst the ones which do not show up on the radar.  The DFOs are helpless in such instances.

Adding to the complexity is a system of “coloured” e-Transit Passes introduced by the then PCCF & HoFF M. K. Yadava through an S.O.P. in 2022.  The plethora of “coloured” e-Transit Passes for Schedule-Y minerals, viz., Orange, Yellow, Blue, Green etc., does not have any Government approval till date, nor do they find mention in the AMCR 2021.  Thus, the entire transport of Schedule-Y minor minerals from the concession areas to crushers, and to the points of consumption is happening based on a system that does not have Government approval, which is a serious irregularity.

There is a feeling among field functionaries of the Assam Forest Department that Zero TPs have slackened the vigil in the concession areas against illegal extraction of minor minerals.  Existence of unregistered projects and unorganized construction segment, and non-availability of an enforcement mechanism with the DFOs to ensure registration and payment of royalties, have resulted in flourishing of illegal networks for the supply of Schedule-Y minor minerals from the minor mineral concession areas to the points of consumption.  Politicians and officials who are into spoils from illegal mineral extraction are happier than ever before, while Government revenues continue to suffer.

It is said that the proof of the pudding is in the eating.  Unreconciled figures show that the revenue collection of the Assam Forest Department during 2023-2024 has plummeted down to Rs.360.78 Crores. This figure is often compared to the pre-Covid revenue figure of 2019-2020, which was Rs.416 Crores and achieved through payment of advance royalties. It is also noteworthy that the last few trap cases by the Vigilance & Anti-Corruption Cell of Assam police (those of Bablu Dey, FRO, Saptagram Range, and B.K. Payeng, D.F.O., Dhubri Forest Division) were all about corruption in the operation of minor mineral concession areas. That there is a leakage in the system is obvious.  Meanwhile, the play of “coloured T.P.s” continues!