Vedanta's Agarwal urges govt to privatise gold mining to boost production

After the budget, top government officials clarified that the government's strategy goes beyond privatisation and the aim now is to create value of the government owned companies

Anil Agarwal, chairman of metals major Vedanta group, has called for the sale of government stake in Bharat Gold Mine and Hutti Gold Mine so as to increase production of the yellow metal in the country.

In a social media post, Agarwal said global gold prices are currently at record highs and India imports 99.9 per cent of its requirement.

“With massive investments, we can be a major producer of gold and a big generator of employment,” Agarwal said.

In India, as of now, only Bharat Hold Mine and Hutti Gold Mine are producing gold and the best way forward is to privatise both the mines, he said. 

In 2023, India's total gold consumption was 747.5 tonnes, a 3 per cent decrease from the previous year.

Gold prices rebounded on Friday after falling for the past three sessions, rising by Rs 50 to Rs 70,700 per 10 grams in the local market due to strong trend in global prices.

The precious metal had earlier closed at Rs 70,650 per 10 grams in the previous session on Thursday.

In the Budget, the central government decided to reduce import duty on gold to 6 per cent from 15 per cent, leading to a sharp fall in the local markets.

In the overseas markets, comex gold was trading higher at $ 2,416.40 per ounce.

Agarwal said the privatisation of both mines should happen with three conditions. “First, no retrenchment, second, some equity for employees; and third, it should be done as it is, without any attempt to parcel assets into different parts. Even if a state government holds shares, the Government of India must sell its equity. Entrepreneurs who acquire it are capable of persuading and working with the state government,” Agarwal said.

Agarwal also lobbied for sale of the government's stake in Hindustan Copper, the sole miner of copper in India. “It is in a similar situation to the gold mines,” he said.

“Even a 10 per cent reduction in gold and copper imports can save $ 6.5 billion in forex, contribute an additional Rs 3,500 crore to the government, and create at least 25,000 jobs,” Agarwal added.

After the Budget, top officials clarified that the government’s strategy goes beyond privatisation and the aim now is to create value for government-owned companies.