The Hindu Business Line : Mining policy likely to undergo changes

New policy
Auctioning of mining blocks has been proposed in the new mineral policy and is largely being seen as a way to cut down on red tapism and hasten the process of granting mining leases.
The Mines Ministry has not fixed any specific time-frame as to when the policy would be placed before the Cabinet.

Phalguna Jandhyala

Panjim, Aug. 24 There may be changes in the New Mineral Policy with regard to auctioning of mines before it is sent to the Cabinet.

According to the Mines Secretary, Mr J.P. Singh, the policy is likely to see changes since there is lack of consensus on the auction of mines.

“There are issues that need to be sorted out like those related to auctioning of mines. It makes a lot of sense for the States but what will we at the Centre do then? Balance is the key and that is what we are aiming to achieve,” he added.

Auctioning of mining blocks has been proposed in the new mineral policy and is largely being seen as a way to cut down on red tapism and hasten the process of granting mining leases.

The New Mineral Policy had been recently approved by the Group of Ministers (GoM) headed by Home Minister, Mr Shivraj Patil.

“The new policy, once approved, will provide tremendous acceleration to the sector. It seeks to address the contemporary needs of the industry and will be placed before the Cabinet soon,” Mr Singh said on the sidelines of a conference on ‘Marketing of Indian Iron Ore’ organised by the Federation of Indian Mineral Industries (FIMI).

No time-frame

However, the Mines Ministry has not fixed any specific time-frame as to when the policy would be placed before the Cabinet.

According to Mr Rahul Baldota, President of FIMI, “Auctioning of mines would only be possible where prospecting has been done but in the regions where there has been no prospecting it will be a no-show.”

Speaking at the conference the Chief Minister of Goa, Mr Digambar Kamat, said that “The mineral industry forms the backbone of the economy. The irony, however, is that this industry has not had the best of luck with policymakers.

“If you want to stop the mining industry then stop it once and for all but there should be no slow poisoning. We need a straight cut policy on all major issues and I hope the New Mineral Policy lives up to expectations.”

On the other hand, Mr Sanjiv Batra, Chairman and Managing Director of MMTC, advocated the policy of long-term contracts and said that very soon a time will come when there will be a convergence between the long-term contract and spot prices.

“At the moment, a majority of ore is sold on the basis of long-term agreements. However, in the next two to three years the industry would move to words convergence between the long-term and spot prices,” he said.

Long-term contracts

Mr Batra also added that at the moment there is 100 per cent difference between the long-term and spot prices and this gap should be reduced as soon as possible.

“The long-term contracts are beneficial to both sellers as well as the buyers but with spot prices hovering around $100-mark, it would be very difficult to persuade sellers to go for long-term contract,” he added.

More Stories on : Mining & Quarrying | Policy

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page