5 states issue notices to auction 28 of 70 mines in 1st phase

Taking forward the auction process for mines like iron ore and limestone, five states including Chhattisgarh, Andhra Pradesh and Odisha, have issued notices inviting tenders for 28 of the proposed 70 mines to be auctioned in the first phase, the government today said.

It also said four other states will come out with notices for mine auction in a fortnight while an attractive mineral exploration policy will be launched soon to attract investment in India's vastly untapped mining sector.

"After amendment in the MMDR Act for transparent allotment of mines, the auction process is going forward. Five states have issued notices inviting tenders for 28 blocks. The government is hopeful of auction of 70 mines by states by January in the first phase," Steel and Mines Minister Narendra Singh Tomar said on the sidelines of a CII event here.

"Very soon, there will be a new National Mineral Exploration Policy, the draft of which has been prepared for seeking suggestions from stakeholders and industry experts," he said.

Regretting that India lagged far behind in exploration of minerals as against developed nations, the minister said the new exploration policy will attract private players in large numbers.

According to mines secretary Balvinder Kumar, things are "looking up" in the mining sector. He said that out of the 28 blocks, notices have been issued for 15 by Karnataka, 5 by Gujarat and 1 by Jharkhand.

"We are expecting another four states to issue notices for auction in the next 10-15 days," the secretary said.

While most states have set up National Mineral Funds, rules for the National Mineral Exploration Trust have been identified, he said, adding that mineral concession rules have been drafted too.

Major challenges facing the sector include attracting private sector players, capacity building, procedural delays, lack of data availability and duplication.

He said the system of reconnaissance licence (RL) did not work between 2001 and 2015. Out of 405 such licenses issued, barely 15 were converted into prospecting leases (PL) or mining leases (ML).

ML is granted for undertaking operations for extracting minerals while PL is for the purpose of exploration. RL, on the other hand, is granted for preliminary prospecting of a mineral through regional, aerial and geophysical surveys.

The secretary said Rs 500 crore has been earmarked for capacity building.

Parliament passed the Mines and Minerals (Development and Regulation) Amendment Act, 2015 in March, which stipulates auction as the only means to allow extraction of minerals.

On November 10, Gujarat said it was starting the mines auction by putting five blocks of limestone -- the key ingredient in making cement -- under the hammer, making it the first one to get off the block.

On November 18, Rajasthan said it will soon start e-auction of three limestone blocks and plans to conclude the entire process by the end of January next year.

The Mines Ministry has identified 199 mines that can be allocated through the auction route. These are located in mineral-rich states such as Rajasthan, Jharkhand, Madhya Pradesh, Chhattisgarh, Karnataka and Odisha.