KOLKATA (miningweekly.com) – India’s mining industry has called on the government to make mining licences freely transferable, thereby creating a market for licences, which will help in the efficient price discovery of resources.

The Confederation of Indian Industry (CII), the country’s largest lobby group of companies, said that a market for freely transferable mining licences would also enable seamless procedures for different stages of mining ranging from exploration to production.

The suggestion, which forms part of the ‘Agenda for the Mining Sector’, was submitted to the Mines Ministry as a roadmap for developing the stuttering Indian mining industry and to boost the investment cycle in the sector, as the measures enunciated would not require any protracted legislative process.

CII urged the federal government to declare mining as a strategic infrastructure sector, considering its potential to lead the growth in manufacturing and employment generation and, at the same time, conserve foreign exchange by reducing import dependency in natural resources, the document said.

CII said that the government should adopt the auction route for allocation of natural resources only after fully exploring the resource blocks.

Simultaneously, the role of the Geological Survey of India (GSI), the sole government organisation entrusted with exploration activities, should be reduced. Instead, the role of the GSI should be to create the right environment wherein foreign resource majors and specialised mineral exploration bodies find it attractive to investment in India, as this would ensure speedier and more widespread exploration activities.

The industry body said that renewal of leases should be automatic instead of a lease being assessed by the Indian Bureau of Mines and certified for renewal, which was a major cause of delays.

“In the event the state governments do not communicate renewal within one year from the expiry of the lease then it should be construed as deemed approval,” CII said.

Significantly, it was the legal dispute over the ‘deemed approval’ clause, which led to the Supreme Court ordering the temporary closure of 26 iron-ore mines in the eastern Indian province of Odisha.

CII pointed out that the Indian mining sector was one of the most heavily taxed industries in the world and that the Mines Ministry needed to relook the tax structure applicable to the mining industry.