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India to auction 100 mineral blocks by Nov, seeks investment boost

Raipur: India will auction 100 prospective mineral blocks of 100 sq km area each by November this year, a move that will boost the country's mining potential. The development comes after the government last week approved a new National Mineral Exploration Policy (NMEP), which will help in attracting more foreign direct investment in the mining sector.

Representational image. Reuters

Representational image. Reuters

"Geological Survey of India (GSI) has identified 100 blocks. SBI CAP is working on the auction modalities for these blocks and will submit its report in 2-3 months," Mines Minister Narendra Singh Tomar told reporters at the first National Minerals & Mining conclave here.

When asked about the time frame of the auction, he said: The process will start in the next 4-5 months.

Tomar said the NMEP is based on revenue share model to encourage private players and FDI. A sum of Rs 2,116 crore will be needed for its implementation, he added.

Stressing the need for private players to come forward, he said India has 8 lakh square km of possible mining area but only 9-10 per cent has been explored. There are two government agencies, GSI and MECL, for exploration but their capacity is limited.

NMEP proposes that private entities engaged to carry out regional and detailed exploration will get a certain share in revenue (by way of royalty/ premium to be accruing to state government) from mining operation from the successful bidder after e-auction of the mineral block.

The revenue-sharing could be either in the form of a lump sum or annuity, to be paid throughout the period of mining lease, with transferable rights. Selection of private explorer is proposed to be done through a transparent process of competitive bidding through e-auction.

He also urged the mining industry to allocate 10 per cent of their profits to mineral exploration, so that true potential of India's mineral resources can be harnessed. For this, reasonable areas/ blocks for regional exploration will be earmarked/ identified by the government for auctioning.

On auction of mines, he said states have so far auctioned seven mines with mineral reserves worth about Rs 29,000 crore. The revenue to accrue from these mines over the next 50 years will be more than Rs 13,000 crore.

Earlier speaking at the conclave, Finance Minister Arun Jaitley commended the changes in policy and legislation brought in the mining sector in past two years. He noted that these have strengthened the mining industry and paved way for employment generation, development of mining affected areas and welfare of people living in mining areas.

Jaitley added that when the downtrend in global commodity reverses, mining industry will benefit the most. Steps being taken to explore the resources will further boost the growth of mines and minerals industry.

Chhattisgarh Chief Minister Raman Singh vision and quick execution have been the hallmark of mining reforms in past two years. "For the state of Chhattisgarh, the DMF and PMKKKY (Pradhan Mantri Khanij Kshetra Kalyan Yojana) have proven to be immensely valuable. The state plans to complete mapping of whole area in coming three years," he added.

Mines Secretary Balvinder Kumar said the Ministry is working on conducting the aero-geophysical survey of 8.13 lakh sq km area for probing deep seated and concealed mineral deposit. "We will complete the mapping in three years," he said. Geological Survey of India (GSI) is undertaking the national aero-geophysical mapping programme (NAGMP) for which it had appointed a consultant in March this year. These surveys provide valuable inputs on soil-covered and concealed minerals deposits. West Rajasthan, Deccan trap and peneplained precambrian terrains are areas that will be focused in the surveys to get more precision in data generation.

Various important initiatives in the field of mining were inaugurated by the dignitaries during the opening session of the national conclave, which included award of star rating of pilot mines, announcement of the skill plan of the ministry of mines, unveiling of National mineral exploration policy and atomic mineral rules.

Updated Date: Jul 05, 2016 10:05 AM

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