SBICaps presentation on mines auction rules next week

SBI Capital Markets is scheduled to make a detailed presentation early next week before senior officials of the Centre and the states about proposed rules for auction of mines and bidding parameters for selection.

The government roped in the investment banker around 15 days after President Pranab Mukherjee promulgated the Mines and Minerals (Development and Regulation) Amendment Ordinance, 2015, in the second week of January to suggest the rules for auction and bidding parameters.

The ordinance paved the way for introduction of the auctioning route for allocation of mines.

"SBI Capital Markets will make a presentation about the salient features of proposed rules for implementing provision MMDR Amendment Ordinance, 2015 next Monday at the Quarterly meeting of the Coordination-cum-Empowered Committee (CEC)," a government official said.

The Ordinance, which has already been passed in Lok Sabha in the form of a Bill, prescribe the Centre to stipulate the terms and conditions and the procedures subject to which the auction would be conducted for allocation of all mines.

The Centre is supposed to lay out the bidding parameters for the selection which may include a share in the production of the mineral or any payment linked to the royalty payable or a combination of the two.

The Centre is yet to decide on that. Since mining is a state subject, auctioning of mines will be conducted by states in which the role of the Centre would be limited to framing the rules to be followed in the process. Following SBI Capital Markets' presentation before the officials and its submission of the final report, the Centre might consult with other stakeholders to avoid any dissent.

Mines and Steel Minister Narendra Singh Tomar had earlier said that the rules and regulations for the auction of major minerals like iron ore and manganese ore would be finalised by May.

The Mines Ministry has already identified 199 mines which contain minerals like iron ore, bauxite and manganese ore that can be allocated through the auction route. These are located in mineral-rich states such as Karnataka, Madhya Pradesh, Odisha, Gujarat and Maharashtra.