Lok Sabha Question No. 2888 (UNSTARRED), answered on 2019-07-10
Subject: Revenue Earned from Auction of Mines
Ministry: MINES
Asked by: Mohanbhai Kalyanji Kundariya, Ganesan Selvam

## GOVERNMENT OF INDIA MINISTRY OF MINES

## LOK SABHA UNSTARRED QUESTION NO. 2888 ANSWERED ON 10.07.2019

## REVENUE EARNED FROM AUCTION OF MINES

## 2888. SHRI MOHANBHAI KALYANJI KUNDARIYA: SHRI SELVAM. G:

Will the Minister of MINES be pleased to state:

- (a) the number of mines auctioned in the wake of Mines and Mineral Development Regulation Act, 2015 along with the quantum of revenue earned therefrom by the Union and the States during the last three years;
- (b)  whether  the  Union  Government  has  conducted  survey  for  the  mines  to  be auctioned and if so, the number of mines identified for auction, State/UT-wise;
- (c)  whether  the  Union  Government  proposes  to  assist  such  States  for  smooth auctioning of mines and if so, the details thereof; and
- (d) whether some hurdles are being faced in the auction process of mines and if so, the details thereof and the action proposed to be taken to remove the same?

## ANSWER

## THE MINISTER OF MINES, COAL AND PARLIAMENTARY AFFAIRS (SHRI PRALHAD JOSHI)

(a):  So  far,  64  mines  of  major  minerals  have  been  auctioned  by  the  States  in  the wake of Mines and Minerals (Development and Regulation) (MMDR) Act, 2015. The estimated total revenue over the lease period of these auctioned mines is ₹ 1,85,093 crore, out of which National Mineral Exploration Trust (NMET) contribution of ₹ 729 crore  shall  accrue  to  the  Central  Government  and  the  rest  is  for  the  State Governments which includes auction premium, royalty and District Mineral Foundation (DMF) contribution.

(b): As per the MMDR Act and the Rules framed there under, the State Governments grant mineral concessions for the minerals located within their respective boundaries in accordance with the statutory procedure. As per the information provided by the State  Governments,  the  number  of  mineral  blocks  proposed  to  be  auctioned  by States is as under:

| S No   | State          | Blocks in pipeline for auction   |
|--------|----------------|----------------------------------|
| 1      | Andhra Pradesh | 17 mineral blocks                |
| 2      | Chhattisgarh   | 11 mineral blocks                |
| 3      | Gujarat        | 11 mineral blocks                |
| 4      | Jharkhand      | 26 mineral blocks                |
| 5      | Karnataka      | 14 mineral blocks                |
| 6      | Odisha         | 39 mineral blocks                |
| 7      | Rajasthan      | 8 mineral blocks                 |
| Total  | Total          | 126 mineral blocks               |

(c):  Central  Government  has  facilitated  the  auction  process  by  providing  initial handholding  support  to  the  State  Governments  for  Transaction  Advisory  Services and Differential Global Positioning System (DGPS) Survey and Total Station Survey, Geological  Report  (GR)  preparation  and  e-auction  platform,  through  institutions  of the  Central  Government  i.e.  Geological  Survey  of  India  (GSI),  Mineral  Exploration Corporation  Ltd  (MECL)  and  Indian  Bureau  of  Mines  (IBM)  and  various  Central Public Sector Enterprises  such as SBI Capital Markets Ltd (SBICAP), MECON Ltd and MSTC Ltd.

(d): Some mineral blocks put up on auction by the States were annulled due to lack of  adequate  number of  bidders.  The  State Governments  identified  the  reasons  as poor  mineralization/grade  of  mineral  ores,  unfavourable  demand-supply  scenario, imposition  of  end  use  reservations  for  mineral  blocks,  unsuitable  land  ownership pattern, high reserve price and payment terms.

To make the auction process simpler and to help the States auction mineral blocks quickly,  the  Mineral  Auction  Rules  were  amended  by  the  Ministry  of  Mines  vide notification dated 30.11.2017. The major amendments in the rules include flexibility to  State  Governments  in  auction  process,  relaxation  in  net  worth  requirement  for increased participation of bidders in auction of mines, relaxation in disposal of up to twenty five percent of total mineral excavated in the previous financial year in case of mines which have been reserved for specified end  use and adjustment  of  upfront payment in full at the earliest against the revenue share.

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