KOLKATA (miningweekly.com) – India’s Mines Ministry is considering administrative changes to improve the “ease of doing business” in the resources industry.
One of the changes under consideration is to put each mineral block to be auctioned under a special purpose vehicle (SPV) of the government, which will secure all mandatory approvals, including environmental and forest clearances.
On completion of an auction of a mineral block, the SPV will then transfer the mineral block to the successful bidder, bundled with all mandatory approvals. This should cut down on delays and the time that it takes successful bidders to operationalise the blocks, government officials have said.
However, the government has apparently turned down inputs from the mining industry seeking financial compensation for tardy implementation of a mining project arising from delays on part of various government agencies in grant of mandatory approvals.
Earlier this month, the Mines Ministry amended the Mines and Mineral Development and Regulation Act relaxing several eligibility criteria, aiming to ensure greater participation from prospective investors at the forthcoming auctions.
One of the relaxations of rules was the scrapping of the requirement for at least three bidders for an auction process to be successful. While in the first round of bidding, a minimum of three bidders will be a prerequisite, the bidding process will be considered valid even if the number of bidders in the second round falls below three.
Secondly, the mandatory end-use requirement of an iron-ore block allocated through the auction route has also been relaxed. It has been found that a miner acquiring an ore block via auction was often hamstrung by the end-use regulations as the grade of iron-ore mined was sometimes unsuitable for the end-use plant.
The Mines Ministry expects provincial governments to complete auctions of at least 34 mineral blocks within the current financial year. These include 17 limestone, eight bauxite, four iron-ore, two copper and two manganese blocks.