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Auction of 54 mines to fetch Rs 1.5 lakh cr for mineral rich states' kitty

The states have garnered Rs 73,000 crore revenue from the auction of 21 mineral blocks so far

Auction Of Mineral Blocks

Press Trust of India  |  New Delhi 

At present, if a company has a mine with 10 mt capacity but is extracting only four mt, it pays royalty on the latter amount
Representative Image

Auction of 54 mineral blocks in the current fiscal is likely to fetch Rs 1.5 lakh crore to the mineral-rich states' exchequer, a top official said on Wednesday.

The states have garnered Rs 73,000 crore revenue from the auction of 21 mineral blocks so far.

"In this current financial year, we expect to auction 54 mines with a mineral value of Rs 2 lakh crore and a revenue implication of accruals to states of Rs 1.5 lakh crore," Mines Secretary Arun Kumar said on the sidelines of an event here.

The first tranche of auctions, which had started last year, witnessed bidding of 21 mine blocks.

The first successful auction took place in February 2016, with two small limestone blocks in Chhattisgarh going under the hammer. The mineral-rich state will generate about Rs 18 crore from the two blocks over the next 50 years.

Since then, 21 mines containing iron ore, limestone, gold and diamond etc have been auctioned.

The lease to mine minerals from these blocks is for 50 years and the total earnings include royalty and contributions for the District Mineral Foundation and the National Mineral Exploration Trust.

This time participation is likely to be increased as more mines, including that of limestone, iron ore and gold, will be put for auction.

The mines ministry has already facilitated the auction process, extending support from IBM and Geological Survey of India (GSI) and various PSUs such as MSTC, MECON, MECL and SBICAP.

Asked about Coal India plans to enter mineral mining, Kumar said, "I would welcome anyone entering the mineral sector because the more the merrier. When more players would exist there would be more fair competition and the economy and sector would tend to benefit".

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First Published: Wed, September 20 2017. 18:46 IST