National Mineral Policy 2006 - Department of Mines

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necessary, therefore, that in infrastructure projects in areas where SME sector mining issignificant the requirements of the miners are factored into the design of the projects.Stronger infrastructure is needed to withstand the load imposed on public utilities by themines in the area. It may be mentioned here that when mining majors build infrastructurespecially suited to the needs of carrying minerals, viz. rail tracks and roadways of muchhigher carrying capacity, the unit cost of transportation decreases with higher volumes.Transportation by railways in Brazil, where mining majors are active, costs US$ 3–4 pertonne while the cost in India is Rs 800 per tonne (about US$ 18 per tonne). In roadways too,while Indian roads can at best accommodate dumpers of 40–50 tonne capacities, the roads inBrazil and Australia are designed for dumpers of upto 200 tonnes.4.9 The critical infrastructure needs of the mining sector in the country may be seen in theshort term as well as in the long term. In the short term, these are the specific needs, such aspower, roads, railways, ports, etc., highlighted by problems being currently faced by themining industry, which is driven by the SME sector. In the long term, looking at the hugemining potential of the country as one of the few untapped resource countries of the worldand the low level of mining activity currently underway, the focus has to be on setting upinstitutional arrangements for facilitating infrastructure development, which will act as anincentive to the growth of the sector by attracting large stand alone mines that will mineefficiently, optimally, and on a sustainable basis. These arrangements need to be devised insuch a way that the absence of infrastructure is seen not as a bottleneck to be overcome but asan opportunity for investment by the mining community by itself.4.10 Short-term infrastructure needs with some suggestions were highlighted by industry inthe presentations before the Committee. These mainly concern the movement of iron ore anddimension stone from mine sites to ports. This is only to be expected because significant noncaptivemining activity as a whole in India is mainly in respect of these minerals and islargely confined to SMEs. The road and rail systems servicing the SME sector areoverburdened and struggle to cope with the increasing tonnages being transported, resultingin freight increases and supply disruptions, in turn resulting in higher delivery costs. Theimmediate critical requirements for the movement of iron ore and stone (granite and marble)have been identified and are detailed below.100
INFRASTRUCTURE NEEDS IN IRON ORE BELTSBELLARY–HOSPET REGION4.11 The Bellary–Hospet sector is endowed with rich iron ore deposits of about 1.5 billiontonnes and this sector currently produces more than 35 million tonnes annually. Since thereare very few large user industries (steel mills) due to water and power shortages most of theiron ore is exported. Around 20–25 million tonnes is exported to China, Japan, and SouthKorea, the balance being sold to the domestic pig and sponge iron units in the region. Thisore is exported through the ports of Mangalore, Chennai, Goa, Visakhapatnam, Kakinada,Karwar, and Belkeri. Therefore, improvement in service by providing connectivity throughshortest distance and modernising the handling equipments is called for in these ports toreduce the transportation cost and turnaround time of the vessels. The quality of roads is notgood enough to meet with the heavy traffic requirements of iron ore trucks from the mines tothe loading stations. Improving road conditions will reduce cost by reducing truckbreakdowns, less fuel consumption, and smoother travel.GOA AND KARNATAKA REGION4.12 Export of iron ore from Goa region is equally important. Of the 78.14 million tonnesof iron ore exported from the country during the year 2004–05, more than 40 per cent, i.e.about 31.40 million tonnes, was routed through Goa. There are certain bottlenecks in theinadequacy of the present railway connection to the port. There is limited line capacity withthe railways to transport iron ore from Karnataka to Goa. The rail and road connectivityneeds improvement by doubling of the line and four-laning the NH. At Goa Port there is aneed to refurbish the mechanical iron ore handling plant and to introduce mechanicalhandling facilities for railway wagons.EASTERN SECTOR: CHHATTISGARH, JHARKHAND, AND ORISSA REGION4.13 The eastern sector, comprising Chhattisgarh, Jharkhand, and Orissa, is endowed withhigh grade iron ore reserves amounting to 45 per cent of the total reserves of the country.Export of iron ore from the above states through Haldia port has increased from 0.35 milliontonnes to 4.96 million tonnes and through Paradip port from 2.73 million tonnes to 9.05million tonnes within a period of five years from 2000–01 to 2004–05. Rail and road linkages101
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National Mineral PolicyReport of th
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ContentsAcronyms...................
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Annexure 5: Using the GRI Guideline
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GDP gross domestic productGIS Geogr
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UNFCUSVATWCUUnited Nations Framewor
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Introduction1. The Government of In
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issues relate to fund raising by pr
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termination of MLs, lowering of cei
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• In the case of large mining ope
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investment. The work done by GSI co
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mainly for minerals of base metals
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1.21 This situation has changed dra
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absent. A study by the United Natio
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example, a mining major may outsour
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would otherwise remain unexploited
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the policy environment must continu
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‘A thrust is to be given to explo
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In reviewing the MMDR Act, it is ne
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permissible activities in order to
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(i)(ii)(iii)(iv)The current two-tie
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per plan should be significantly hi
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Duration of Concessions1.48 In the
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10,000 sq. km in a state. This has
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(ii)(iii)(iv)The maximum total area
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e obviated if the lease deed is exh
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elinquishment of areas by the lesse
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to give priority to the prior appli
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(v)(vi)(vii)Rules should be prescri
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esponsible for all rights, liabilit
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Page 62 and 63: government at the Secretariat. A le
Page 64 and 65: Secretary. If the Directorate is in
Page 66 and 67: (i) All applications for mineral co
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Page 70 and 71: concerned State Government (or othe
Page 72 and 73: Further, Rule 7D of the MCR specifi
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Page 76 and 77: Chapter 3Forest Conservation and En
Page 78 and 79: conservation. There are trade-offs
Page 80 and 81: ICMM AND SDF3.8 The ICMM membership
Page 82 and 83: higher level. The basic approach is
Page 84 and 85: (i) To minimize displacement and to
Page 86 and 87: affected PAPs in the mining operati
Page 88 and 89: that a well-regulated and responsib
Page 90 and 91: (iii)Notwithstanding the above, sur
Page 92 and 93: egard, all ‘forest’ land must b
Page 94 and 95: Figure 3.1: Procedure for Processin
Page 96 and 97: should be authorised to grant or re
Page 98 and 99: formulation and appraisal of the EI
Page 100 and 101: 3.41 Recognising the need to make t
Page 102 and 103: Figure 3.3: Public Hearing/NOC from
Page 104 and 105: Chapter 4Infrastructure Needs and F
Page 106 and 107: 4.5 Logistics is the key to access
Page 108 and 109: Table 4.1: Mineral Production in In
Page 112 and 113: to the ports of Haldia and Paradip
Page 114 and 115: Connectivity of Major Ports, brough
Page 116 and 117: (iv)(v)(vi)(vii)At Visakhapatnam Po
Page 118 and 119: was of the opinion that while the m
Page 120 and 121: such an arrangement, the Ministry o
Page 122 and 123: developed, controlled, and run by s
Page 124 and 125: subject to overt and covert restric
Page 126 and 127: consideration to the end use of the
Page 128 and 129: (iii)parameters laid down in existi
Page 130 and 131: Chapter 6Augmenting State Revenues(
Page 132 and 133: the value addition question conside
Page 134 and 135: In a system of ad valorem rates of
Page 136 and 137: must provide revenues sufficient to
Page 138 and 139: Box 6.1: Methods of Valuation of Ro
Page 140 and 141: Another point to be borne in mind b
Page 142 and 143: ailable, cognisable criminal offenc
Page 144 and 145: e worked out. This should be string
Page 146 and 147: 7.3 Considering the high-risk natur
Page 148 and 149: Table 7.2: Minimum Listing Requirem
Page 150 and 151: (ii)(iii)only. Such funds have not
Page 152 and 153: addition, the minimum post-issue fa
Page 154 and 155: and hence this ore should be conser
Page 156 and 157: miners distort the market for their
Page 158 and 159: 7.22 The current law does not make
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is mostly of low grade magnetite. H
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Most magnetite findings are entirel
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in UK 206 kg, and in China it grew
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metres. The use of down hole drill
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7.42 Despite the fact that SME mini
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also be a consideration. However, t
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price, reduce profitability, and pu
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IMPACT ON DOMESTIC IRON ORE PRICES
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7.58 Export of iron ore fines on a
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POLICY ON BEACH SAND MINERALS7.64 B
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not contain more than 0.1 per cent
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7.73 On 18 January 2006, the DAE no
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with the Centre is mainly to ensure
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India enterprise) reported that the
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chloride process pigment technology
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are disposed of in the mined-out ar
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directed to ensure that the AERB/AM
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would have to be carefully drafted
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‘In coordination with the Geologi
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Exploration Licences• The current
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• The fees should be significantl
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surveys have been undertaken, the P
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automatic until the exhaustion of t
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y stating in the MMDR Act that a pr
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departmental representative for sec
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therefore (under Rule 63A), pass su
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• Section 12(1) of the MMDR Act s
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o The lessee should not be asked to
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again and the State Mines Departmen
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• As in the past, no environmenta
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oad and rail, and lack of long-term
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government to the applicants who ar
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next three-year period as well. In
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• Rates of dead rent should be ra
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measure to provide a level playing
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• In respect of three titanium be
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No-I&M-25(3)/2005Government of Indi
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No-I&M-25(3)/2005Planning Commissio
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‘Efforts would also be made to gr
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ecommending amendments to the Act a
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etained as a Prescribed Substance u
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OthersShri Arvind VarmaEx-Secretary
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16. Reserve Bank of India17. M/s Ji
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the RP holders in areas beyond 25 s
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Appendix ERecommendations of the Ex
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(1) Provide proximate and strategic
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technology to enter the Indian stee
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Cross-country Comparison of Mining
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Appendix F (cont.)Country Mining La
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Cross-country Comparison of Mining
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Appendix G (cont.)Country Mining le
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CountryAppendix H (Cont.)Environmen
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AustraliaIndonesia 9 4 Not specifie
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Annexure 1 (cont.)Geologicalenviron
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operations are undertaken over a fa
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B. After Rule 54 of the Mineral Con
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the Central Government to entertain
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applications, could exercise the ju
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We most humbly request that the abo
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Annexure 4The 2002Sustainability Re
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While unique in its coverage and pr
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• facilitate comparability• add
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AssuranceJust as investors look to
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The Guidelines are structured in fi
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There are many aspects relevant for
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- Issues in which community partici
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Annexure 7Royalty Accruals on Miner
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Sl.No.MineralAnnexure 8 (cont.)2003
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Annexure 91 THE SECOND SCHEDULE 1(S
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(v) Group V Coals:(a) Non-Coking Co
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23. Iron Ore:(i) Lumps:(a) with 65
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45. Tin Five per cent of London Met
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International Comparison of Royalty
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Production, Consumption, Exports, a
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National Mineral Policy 2006 - Department of Mines

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