KOLKATA (miningweekly.com) - Stung by a series of court clampdowns on the arbitrary and illegal allocation of natural resources, the Indian government is starting to lay down a roadmap to auction mineral resources.

For starters, the government would be putting 31 mining leases of fully prospected iron-ore and bauxite reserves up for auction by April 2015.

The government was in a hurry to put in place a transparent process for natural resource allocation to private investors and to clean up grey areas in processes adopted so far, as this was necessary to improve the investment sentiment and climate in the country, a senior government official involved in drafting the auction rules said.

This was against the backdrop of the Indian Supreme Court in 2012 declaring that the allocation of 2G telecom spectrum was illegal, and cancelling 122 telecom licences allotted to 11 companies after January 2008.

In a similar vein, the Supreme Court in September this year declared 214 coal blocks allotted to companies by the government since 1993 to be arbitrary and illegal and directed the government to take back all coal blocks and put them on the auction block. The government announced that 74 of these coal blocks would be offered afresh to investors through electronic auction during December and January.

The move to put iron-ore and bauxite mining reserves on the auction block was the first time that the auction route would be adopted to ensure competitive bids and transparency in awarding iron-ore and bauxite resources.

The first lot of iron-ore and bauxite mining leases would be those where reserves have been established through prospecting by provincial level exploration agencies, the official said.

The government had also circulated a directive to various provincial governments to hasten the processing of over 60 000 mining leases pending at provincial and federal government level so that more mineral blocks could be added to the auction list within the next financial year, he added.

The Indian Bureau of Mines, the multidisciplinary government organisation overseeing the mining industry, has also been directed to verify all data relating to the 31 iron-ore and bauxite mining leases and to submit a report to the Mines Ministry before the bidding process commenced.

The Mines Ministry was in the process of weighting various parameters for prospective bidders, such as technical expertise in mining iron-ore and bauxite, proposed investments, balance sheet strengths, and details of end-use, aside from the financial bids, the official added.

The Ministry last month communicated that provincial government should put in place time-bound processes under which reconnaissance and prospecting licences were transferred on a commercial basis, to attract specialised mining companies to participate in the auction process.