One of India’s premier industrial representative bodies, the nonprofit Federation of Indian Chambers of Commerce & Industry (FICCI) has expressed concern over the drop in mining concessions being awarded every year.
In a presentation to Niti Aayog, a policy think tank of the Government of India (GoI), the Chamber called for the government to “expedite” auctions of mineral blocks, moneycontrol.com reported. The FICCI pointed out that the average of such sales had come down to 15 mines annually today, compared with the 300-400 mineral concessions given prior to 2015.
As part of reforms and in the interest of mining sector transparency, the Indian Parliament passed the Mines and Minerals Development and Regulation Amendment Bill in 2015. The Indian government claimed this had removed the arbitrariness seen earlier in such auctions.
FICCI said although the 2015 act does grant the winner of the mineral block with sub-surface mineral rights, the company had to face a lot of red tape to seek the surface rights and obtain necessary statutory clearances. This was a hindrance in converting successful auctions into production on the ground.
Citing unnamed sources, moneycontrol.com reported officials from Rio Tinto, Tata Steel, Vedanta and the Federation of Indian Mineral Industries (FIMI) also were part of the presentation.
The mining sector of India had already been demanding further reforms, including the implementation of a “One Tax Regime” in mineral production along the lines of GST, with the effective taxation rate (ETR) capped at 40%, the Hellenic Shipping News reported.
A few days ago, Niti Aayog itself set up a high level committee to look at ways and means of boosting mining in the country, according to CNBC-TV18 reported.
Mining contributes about 2% to India’s GDP, but some in India claim it could go up to as much as 10%.
In FY 2018, for example, India’s import bill hit U.S. $465 billion, of which $126 billion, or 27%, consisted of metals and minerals alone.