KOLKATA (miningweekly.com) – India will auction 105 mineral blocks before the end of the current financial year, the Mines Ministry informed Parliament on Thursday.
According to information provided by the Mines Ministry, various state governments have completed the auction of 18 mineral blocks over the past nine months, which included seven iron ore blocks in Karnataka and five in Madhya Pradesh.
The Ministry also informed that Geological Survey of India (GSI) will complete exploration report of 18 mineral blocks by February, and hand over the reports to the respective state governments to enable them to put these up for bidding by private miners.
One of the biggest challenge in stepping up exploration and increasing monetisation of assets is low exploration capacities available in the country, with only 82 agencies being designated to undertake exploration projects. This compares with 400 designated agencies in Australia.
At the same time, the government’s aim to increase spends on exploration by setting up the National Mineral Exploration Trust (NMET) too has failed to take off. For example, with the fund having a corpus of about Rs10.48-billion as on July 2018, only 62% of the fund has been utilised in exploration projects funded through the fund.
NMET had been created by making it mandatory for every mineral leaseholder to contribute amount equaling to 2% of royalty payable for each mineral produced by the leaseholder.
However, a section of the government conceded that plans to put such a large number of mineral blocks up for auction and completing the process within the next three months of current financial year could prove to be an uphill task since the Indian national elections are scheduled to be held any time over the next few months.
It was pointed out that once the Election Commission of India notifies the election dates, the federal government will be turned into lame duck one and political parties at helm of governments at various states will be pre-occupied on the campaign trail and mineral block auction will be put on the backburner until a new government was formed in New Delhi.