With the new mining law in place, states can grant lease for major mineral extraction, including iron ore, through auctioning on their own without waiting for the Ministry of Mine’s permission.
The states, which want to give mining lease permission, are now only required to take permission from Ministry of Environment and Forests. Once the states get nod from the Environment Ministry, it can go ahead with grant of permission for lease through auctioning, a senior official in the Mines Ministry told Deccan Herald.
Earlier, all major minerals extraction required the Ministry of Mines permission. Now by allowing the states to grant lease permission without seeking the Centre’s approval, the delay in granting licence has been eliminated, the official added.
However, the state strictly followed auction route for granting permission.
Separately, Mines and Steel Minister Narendra Singh Tomar said here that the ministry is preparing draft regulations for auctioning and it will be sent to the states to seek their views within a week.
Mines and Minerals (Development and Regulation) Amendment Act, 2015, empowers the Centre to prescribe terms and conditions and procedures for bidding which include production sharing or royalty payment or a combination of both. The states have to hold bidding as per the laid down procedure and grant lease permission.
The Centre has roped in investment banker SBI Capital Markets to suggest rules for auctions as well as the bidding parameters. Indian Bureau of Mines, an organisation in the Ministry of Mines, will act as the nodal agency to help the state governments in auctioning as well as studying the mineral deposits.
The Mines Ministry has already identified 199 mines which contain minerals like iron ore, bauxite and manganese ore that can be allocated through the auction route. These are located in mineral-rich states such as Karnataka, Madhya Pradesh, Odisha, Gujarat and Maharashtra.
The minister also said the five PSUs, including Sail and NMDC may be engaged in the process of exploration of mines besides the Geological Survey of India. If the states desire they can set aside mines for their PSUs besides participating in the auction process, the minister added.