India is looking to auction 34 mineral blocks by March after easing rules for bidders.
“The amendment to the Mineral Auction Rules, 2015 will give a fillip to the auction process,” Arun Kumar, secretary at the ministry of mines said. The government expects a revenue of Rs 75,000 crore.
Earlier, states used to prescribe end-use conditions. Many mines with low-grade ores could neither use it for captive purposes nor dispose it of. In the amended rules, miners will be able to dispose of 25 percent of such dumps not used for captive purposes.
The net worth requirement has also been reduced to Rs 50 lakh from Rs 4 crore for an average annual production of up to Rs 2 crore. For production of up to Rs 20 crore, it’s been reduced by three-fourths to Rs 10 crore.
"These are a few small steps in the right direction. Most are procedural to enhance government’s success in auctions and improve timelines,” Anjani Agarwal, partner and leader at metals and mining at EY, said. “The key one is easing the end-use condition to allow disposal of up to 25 percent. It will help extraction of valuable minerals and processing of lower grades for diverse end uses.”
The government hopes to increase revenue from mineral auctions in the future. “We expect to auction 60-70 blocks in FY19 which will generate a revenue of Rs 1.75 lakh,” Kumar said.