KOLKATA (miningweekly.com) – The National Institute for Transformation of India (NITI Aayog), government’s policy advisory body, has called for the proposed National Mineral Policy (NMP) to stimulate more mineral exploration, noting that only 10% of the country’s obvious geological potential has been explored.
Making submissions to the Mines Ministry currently working on the finalisation of a new version of the NMP, the policy advisory body has said that “success stories of our proven deposits are not from extensive exploration, but merely by chance”.
The gross “under exploration” has been underlined by global comparisons in investments, with NITI Aayog pointing out that Indian exploration averaged $9/km2, against $5 580/km2 in Australia and $5 310/km2 in Canada.
Furthermore, in respect of global share of exploration expenditure, Canada is in the first position with 14%, Australia 13%, China and Latin America 6%, Europe 5% and India lagging at the bottom at 0.2%.
Under-exploration has been the direct cause of India’s high import dependency in minerals including copper, copper concentrates, diamond, nickel ores, gold and potash, except coal. For every 1 t of domestic production of these minerals, 10 t are imported, according to 2016/17 export-import data.
Other government departments, including mining departments of federal and provincial governments, maintained in their submissions that the present mineral exploration policy and administrative environment are “actually disincentives to exploration projects”.
An example being the stipulation that only blocks that are explored to the level of G2 or G3 could be put up to auction. However, no exploration company or agency would choose to undertake such levels of exploration without being granted the “first right of refusal” when undertaking the prospecting or compensation that would defray expenditure incurred by them at the exploratory stage.
Under the present licensing regime, an agency or company specialising in mineral exploration will be granted a nonexclusive reconnaissance permit. On completion of exploration, the agency or company could either keep exploration data or submit it to provincial governments to undertake subsequent auction for allocation of a mining lease or composite prospecting cum mining lease. However, the agency or company which completed the exploration project had no direct claim on a mining lease or composite prospecting cum mining lease as a right stemming from having completed exploratory project.
The stakeholders have questioned why any agency or company will undertake exploration if they did not enjoy any preference in the course of bidding for subsequent licences.