National Mineral Policy 2006 - Department of Mines

are similar to operations of private sector entities and no ostensible public purpose is servedby giving PSUs an overriding priority.1.75 The Committee headed by the Additional Secretary, Ministry of Mines that went intothis issue had observed that the reservation provision not only had led to blocking off largeareas from being explored and mined, but had also been used to circumvent other provisionsof the Act, such as the ‘first-come-first-served’ principle or prioritisation entitlement ofconcession holders. This is through the mechanism of so-called JVs or MOU-based subcontractarrangements between PSUs and individual private parties. It has been argued that ifgovernment entities want to get into detailed exploration or mining ventures as businesspropositions then they should be treated as any other party without any special dispensation,and if they are interested in a JV they could make such arrangements prior to staking a claimfor a particular area.1.76 The Committee agrees that it is necessary to provide a level playing field to theprivate sector but this has to be accomplished without disturbing the primacy of promotionalwork done by national agencies. At the same time, it is also necessary to allow the PSUs topursue their core competence albeit in a competitive atmosphere. The followingrecommendations are, therefore, made:(i)(ii)The emphasis on both public and private sector investment in exploration,especially regional exploration or reconnaissance, needs to continue. However,looking at the need for private investment in these activities it is necessary thatPSUs of the Central and state governments be treated at par with private sectorcompanies in the grant of mineral concessions. The reservation provisions forPSUs for exploration and mining should be modified so as to limit the scope ofsuch reservations to specified purposes such as to meet the requirement of SMEsfor raw material. Besides, promotional work at public expense need not beundertaken if the private sector is willing to spend and invest on the same work.Where detailed exploration/prospecting is undertaken by state or Centralorganisations like GSI, MECL, or state-level Directorates as promotional work(i.e. at public expense) and mining based on such prospecting is to be undertakenby a third party, then such areas/blocks should be farmed out for mining on atender/auction basis. This would not only ensure that transparency is maintained,49