Mineral Resources and Policy in India – Hardcover Jetli, K. Narindar

PREFACE

Amongst natural resources, minerals form a special category as they are wasting assets. Once they are taken out of the ground and utilised, they are lost for ever. They should, therefore, be treated on a different footing from replenishable natural resources.

The metallurgical and mineral industries constitute the bedrock of industrial sector as they provide the basic raw materials for most of the industries. The development and management of mineral resources plays a major role in the industrial growth of a nation and its people at large. As minerals form the basis of modern industry in peace and in war, it is necessary to have a rational policy as regards their working and utilisation. The keynote of this policy should be conservation and economic working.

With the coming into force of the Constitution of India on January 26, 1950, the legislative powers of the Central and State Governments were clearly defined. Entry 54 of List I (Union List) in the Seventh Schedule of the Constitution empowered the Central Government to regulate mining activities and the development of minerals. Entry 23 of List II (State List) in the same Schedule of the Constitution empowered the State Governments to frame rules and regulations in respect of mining activities and mineral development, subject to the provisions of List I.

In the federal structure of India, the State Governments are the owners of minerals located within the boundary of the State concerned. The Central Government is the owner of the minerals underlying the ocean within the territorial waters or the Exclusive Economic Zone of India.

The State Governments grant the mineral concessions for all the minerals located within the boundary of the State, under provisions of the Mines and Minerals (Development and Regulation) [MMDR) Act, 1957 and Mineral Concession Rules, 1960. For minerals specified in the First Schedule to the

MMDR Act, 1957, before granting the mineral concession, approval of the Central Government is necessary.

Also, the Central Government notifies certain minerals as minor minerals from time to time for which the absolute powers for deciding on procedures of seeking applications for and granting mineral concessions, fixing rates of royalty, dead rent, and power to revise orders rest only with the State Government.

The following 3 Ministries of the Government of India deal with matters pertaining to mineral resources of India.

Ministry of Mines: It is responsible for survey and exploration of all minerals-other than natural gases, petroleum and atomic minerals for mining and metallurgy of non-ferrous metals like aluminium, copper, zinc, lead, gold, nickel etc. and for administration of the Mines and Minerals (Development and Regulation) Act, 1957 in respect of all mines and minerals other than coal, natural gas and petroleum. In other words, Non-coal and non-fuel minerals are under the control of Ministry of Mines, Government of India.

Ministry of Coal: This Ministry has the overall responsibility of determining policies and strategies in respect of exploration and development of coal and lignite reserves, sanctioning of important projects of high value and for deciding all related issues.

Ministry of Petroleum and Natural Gas: It is entrusted with the responsibility of exploration and production of oil and natural gas, their refining, distribution and marketing, import, export, and conservation of petroleum products and liquefied natural gas.

India’s per capita mineral consumption is one of the lowest in the world. The growth in cement and energy sector has been faster than growth in the metallic sector. Realising the need for a faster pace of industrialisation, the country has pursued an integrated approach to mineral development, attempting to augment the mineral base by establishing giant exploration and exploiting agencies. Presently the country is comfortably Mineral Resources and Policy in India and decorative stones and coking coal and a major placed in the field of bauxite, iron ore, limestone, dimensional breakthrough is required for augmenting the reserves of diamond, platinum, base metals, fertiliser and industrial minerals.

The mineral wealth of India, though by no means inexhaustible, comprises an adequate range of useful products that are necessary for the industrial development of the country. An appraisal of the reserves shows that while in respect of minerals essential for basic industries coal and iron the reserves are ample, the country is deficient in a fairly long list of vital minerals like ores of copper, tin, lead, zinc, nickel, cobalt and in sulphur and most important of all, petroleum.

India is heavily dependent on imports of crude oil and petroleum products and this dependence will increase in the years to come. As a result, there is substantial foreign exchange outgo.

Minerals, being non-renewable resources of the country, require special attention so that these are exploited and utilised in an optimal manner. The role of mineral prospecting, exploration, mining and utilisation assumes importance in this context.

Making minerals available at internationally competitive prices to consumers should be the policy objective of mineral policy. The domestic mining industry will have to compete with imports as no protection will be available except what is permitted under World Trade Organization (WTO) regime.

Based on the recommendations of High Level Committee on National Mineral Policy (Chairman: Anwarul Hoda), 2006, the National Mineral Policy (NMP), 2008 was announced by the Government of India in March 2008. NMP, 2008 endeavours to attract technology and fresh investment through specific measures. NMP, 2008 enunciates measures like assured right to next stage mineral concession, transferability of mineral concessions and transparency in allotment of concessions in order to reduce delays which are seen as impediments to investment and technology flows in the mining sector. NMP, 2008 also seeks to develop a sustainable framework for optimum utilisation of the country’s mineral resources for the industrial growth in the country and at the same time improving the life of people living in the mining areas, which are generally located in the backward and tribal regions of the country.

To enhance the indigenous mineral resources, intensive exploration is required. An enabling environment must be created to attract new investments through private sector participation with modern technical and managerial expertise for finding new deposits and develop them sustainably.

June 2011 New Delhi

Narindar Jetli