Meghalaya not to allow foreign investment in mining

Mineral rich Meghalaya, one of the seven sisters of North-East, has given its thumbs down to foreign direct investment (FDI) in the state’s mining sector. The state has readied a new mining policy to promote “scientific” mining in the state; however, FDI would not be welcomed in a bid to protect the “prospects” of local miners.

Meghalaya is endowed with large deposits of a number of valuable minerals like coal, limestone, uranium, granite, kaolin, clay and glass sand. For last couple of years, the state government had been working on drafting a new mining policy and the draft policy is now ready and will be notified “in a month or two.”

The draft policy had a clause which “encouraged” FDI in state’s mining sector. However, owing to apparent pressure from the local mining lobby, the clause in the final draft has been eventually removed.

“Foreign direct investment and technology by overseas corporate bodies and NRIs would be encouraged for mining, exploration, value addition in mineral sectors and environment protection as per the Government of India policy,” was the clause that finds no mention in the final draft.  

Speaking to Business Standard, Bindo M Lanong, deputy chief minister of Meghalaya, who also heads the mining department said: “We are not banning the entry of foreign investors. Only thing is preference will be given to local miners as we need to keep the prospects of local miners also in mind. FDI which will take away the prospect of the local miners will not be encouraged.” 

Lanong also added that in addition to local miners, “preference will also be given to people from our country.” 

Nevertheless, Lanong said that the prospects of foreign companies presently engaged in mining in Meghalaya will not be effected in anyway.

“Foreign companies who are presently engaged in mining in Meghalaya will remain the same even after the mining policy is notified,” said the deputy chief minister.  

French cement giant Lafarge is engaged in a limestone mining project in Meghalaya (the project is presently stalled and sub-judice) to feed one of its cement plants in neighbouring country Bangladesh.  

Lanong said that the mining policy is ready and will be placed before the cabinet for approval “in a month or two” and will be notified soon after the approval is granted.  

The mining policy will also be in consonance with the objectives provisions of Meghalaya industrial policy. 

The incentives offered under the state industrial policy will be available to eligible mineral based industries which includes special benefits on capital investment for small and medium scale industries, export oriented units.  

Besides others, the objective of the mining policy is to develop and exploit mineral resources in a scientific and sustainable manner, taking into account the interest of the state.