The Supreme Court's decision allowing state governments to impose retrospective taxes on mining activities from April 1, 2005, is poised to have significant economic consequences. The ruling is expected to increase input costs, especially in the electricity sector, potentially leading to higher tariffs or financial strain within the power industry. Coal-dependent states may turn to imports, impacting the national trade balance. Corporate profitability, particularly in public sector enterprises and resource-dependent private conglomerates, could face pressure due to increased costs. The ruling also raises concerns about the balance of federalism, as the retrospective nature of the tax may strain state-centre relations.