Kolar gold mines revival may burden exchequer: Officials

BENGALURU: The Karnataka government has reservations about the revival of Bharat Gold Mines Ltd (BGML), Kolar as any effort to restart them would cause a loss to the state exchequer.
At a meeting with chief minister HD Kumaraswamy, industries department minister KJ George and chief secretary TM Vijay Bhaskar here on Tuesday, officials said the government could lose money in the revival effort.
The Centre’s proposal asking the Karnataka government to revive the mines includes the state taking over liabilities of no less than Rs 1,600 crore. According to government sources, the net sum of mining operations and reviving the mines would burden the exchequer more than the earnings. The state government decided to ask the Centre to forgo liabilities owed by BGML in the revival plan. “If the Centre accedes to our demand, there’s a chance of us taking over the mines. Nonetheless, reviving mining will be expensive,” said a senior government official.
The government and the mines department have already concurred that the gold yield is low and wastage is high.
According to the Centre, the state could recover liabilities in the long run by taking over land parcels available with BGML. Kumaraswamy has asked George to negotiate with the Centre to try and save the mines from being permanently shelved.
This is the second round of negotiations with the Centre and the Union mines ministry. BGML revival has been one of the most speculated public sector units return to full glory, with employment opportunities virtually nil due to the stopping of operations in 2001.