Revenue implication of Rs 4,162 cr as Odisha's iron-ore grade declined: CAG

The Comptroller and Auditor General of India (CAG) which conducted an audit of six iron-ore mines in Odisha has observed that after the auction of the selected mines, there was an "abrupt and abnormal decline in the grade of iron-ore and its classification", as reported by new lessees.

"The decline of grade of iron ore has resulted in a revenue implication of approximately Rs 4,162.77 crore for the financial years 2020-21 and 2021-22 in the form of lesser royalty and premium (post auction)", the CAG said in its report No 6 of the year 2024, which was laid before the Odisha Assembly on Wednesday.

Though more than 83 per cent production was reported in the grade of 62-65 per cent Fe (iron) in the pre-auction period, the same came down to approximately 16 per cent in the two years after auction (2020-2022), it said.

Similarly, the auditor said, the share of grades 60 per cent Fe and below went up from approximately 11 per cent of total production to more than 60 per cent of total ...