FCC

India urged to reform mineral exploration policies

2023-10-11

Sumit Deb the outgoing President of the Federation of Indian Mineral Industries (FIMI) has called for comprehensive reforms to stimulate mineral exploration in India. Speaking at the 57th annual session of FIMI, Deb expressed concerns about the potential lack of interest from international Junior Exploration Companies and domestic exploration firms in participating in the auctioning of exploration licenses under the proposed regulatory framework.

Deb highlighted reservations regarding the amended Mines and Minerals (Development and Regulation) Act 2023 suggesting that it may not effectively achieve the objective of identifying and securing critical and deep-seated mineral resources essential for India's economic growth.

He emphasised the need to reassess the mineral concession policy and adopt a more favourable framework in alignment with international industry standards. The amended MMDR Act introduces the concept of exploration licenses (EL) which will be granted through auctions for conducting reconnaissance and prospecting for critical and deep-seated minerals.

Deb raised concerns about the proposed mechanism for granting exploration licenses, particularly the concept of reverse bidding where bidders must specify the percentage revenue share payable by the successful lessee over a 50-year period. He argued that this approach does not align with international best practices observed in mineral-rich countries like Australia Canada and South Africa.