The Hindu Business Line : Govt may allow FDI in mineral prospecting

WINNERS ALL: (From left) Mr M.B.N. Rao, CMD, Canara Bank; Mr S.C. Gupta, CMD, Punjab National Bank; Mr Pawan Gupta, Director, P.P. Jewellers; and Mr V. Balasubramanian, Group President, Reliance Industries Ltd, at the Niryat Shree & Niryat Bandhu Awards ceremony of the Federation of Indian Export Organisations in the Capital on Tuesday. — Kamal Narang

New Delhi , Dec. 26

The Government may allow foreign direct investments in the mineral prospecting sector, the Union Commerce and Industry Minister, Mr Kamal Nath, has indicated.

"We have lot of reserves in coal, iron ore and manganese. For mineral prospecting, we need huge investments and best technology. There is no question of an FDI limit or a cap. We have to open it (mineral prospecting) up in a broad way so that desired investments and technology are obtained," Mr Kamal Nath told reporters when asked whether any cap would be placed on FDI in mineral prospecting activity.

The Government already allows 100 per cent FDI in mineral exploration and mining under the automatic route. The Ministry of Mines is currently formulating a national mining policy based on the Hooda Committee report, which had stressed the need for more focus on mineral prospecting.

The Geological Survey of India (GSI) on an average spends about Rs 18.03 crore annually on prospecting and exploration, out of which Rs 7.55 crore is spent on exploration for coal. In addition, expenditure on prospecting of minerals is also incurred by other public sector undertakings and private sector.

Revamping AEZs policy

Meanwhile, Mr Kamal Nath said that the existing policy on agri-export zones (AEZs) would be modified so as to make such zones more attractive for investments. AEZs have not taken off in a big way in the country and the Government now proposes to correct that situation through appropriate policy modifications.

FIEO Awards

Earlier, speaking at the FIEO awards function, Mr Kamal Nath underscored the need to look at a more efficient agriculture sector. Stating that agriculture is not yet engaged with the global economy, Mr Kamal Nath said that the country needed to strategise on agricultural exports. He asked FIEO to undertake a study on how to strategise for the next five years for agricultural exports.

"Agriculture has to be sustainable in India. Agriculture is now subsistence, with 650 million people contributing 23 per cent of GDP. That just does not work. Agriculture must also engage with the global economy," he said.

Earlier in the day, Mr Kamal Nath inaugurated FIEO's own building, `Niryat Bhawan', in the Capital. Speaking on the occasion, the Minister said that strong export growth was necessary for achieving 10 per cent GDP growth. "Export is one of the important cogs in the wheel. If our export growth is not going to take place, we are not going to be able to achieve the 10 per cent goal that has been set by the Prime Minister," he said.

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