The NDA government after having initiated measures to boost mining including allowing 100% foreign direct investment in the mineral sector has recently announced another initiative of Star Rating of Mines in India. The concept is aimed at bringing higher accountability and transparency amongst the mining companies through a system of self evaluation and one that is based on a host of essential indicators including social, economic and environmental parameters. Power, coal, renewable energy and mines minister, Piyush Goyal is of the view that all mines in India should necessarily have a four-star rating and the government as a facilitator would help them reach the desired level. Going forward star-ratings will also help companies get faster environmental clearances.
Being viewed as a game changer for the Indian mining industry, EnergyInfraPost.com spoke at length with the union mines secretary, Balvinder Kumar on this powerful tool designed by the ministry in mines through Indian Bureau of Mines (IBM) and for implementation of the Sustainable Development Framework (SDF) in the mining sector.
Excerpts of the Interview with Union Secretary of Mines, Balvinder Kumar
How challenging is to engage the private sector players in exploration of minerals?
The New Mineral Exploration Policy 2016 will help overcome this challenge. The new policy that will give 100 mining acreages to explorers proposes specific incentive structure for participation of all companies. Both PSUs and the private sector are important pillars in mineral exploration and their participation is vital for technology infusion and investment inflow for accelerating exploration in India.
So how are you going about it?
Like I said, we have identified 100 exploration blocks to take up regional and detailed exploration (30 for surficial minerals, 70 for deep seated minerals) with participation of public and private sector. SBICAP has been engaged for developing bidding process and model documents. Under the NMEP 2016, the geoscientific data is being made freely accessible. GSI will develop an “Online Core Business Integrated System” to integrate and share available data, information and products through a geospatial platform to all stakeholders. Then a National Geo-science Data Repository (NGDR) will be set up by GSI. Then we have recently unveiled a web portal for the easy access to information regarding the mining sector in India including rating of mines.
Tell us more about the rating of mines?
The star rating system, that rates mines out of five stars, is a two-layered system based on a self-evaluation by the mine operator. The rating is based on various indicators including social, economic and environmental parameters and under the template developed by IBM, all these parameters carry certain weightage.
Based on self evaluation, points are awarded to the party. Those getting above 90 marks on a scale of 100 will get 5-stars and those getting between 80-90 points get a 4-star rating. This system is aimed at creating a healthy competitive environment amongst mining companies as this system recognises good performers while encouraging others to compete and strive further for excellence.
The main objective of this system is to bring all mines to minimum 4- or 5-star rating in the shortest possible time. Everything is transparent and can be accessed in public domain. Our minister (Piyush Goyal) has publically said that all mines in India should necessarily have a four-star rating and the government as a facilitator would help them reach the desired level.
But how reliable is the self-evaluation system for mine operators?
Like I said it will be a two layered process. In addition, the ministry will also have random third-party checks to see whether the information provided by the operators is correct. In case of an anomaly, there will be penalties for those operators providing false information.
States like Madhya Pradesh, Chhattisgarh, Jharkhand, Odisha and many other states are rich in minerals. How are you engaging with states so as to ensure a conducive environment for mining?
States are the biggest beneficiaries and we are holding continuous dialogue with state governments. We are assisting states in the best possible manner and most states have assured to extend the required support for implementation of NMEP. Then MoUs are being signed with minerals bearing states, where fixed timelines for completing exploration activities.
Could you elaborate a bit on the process for these 100 blocks that have been identified?
Out of these 100 blocks, the mines ministry has allotted 30 for exploration to Mineral Exploration Corporation Ltd (MECL). Funds will be given funds out of the National Mineral Exploration Trust (NMET) set up to boost exploration in the country. We are expecting to collect Rs 500 crore annually by imposing 2% royalty on miners for NMET. Now if minerals are found following exploration by MECL, the blocks will be handed over to states for auction. The money received after auction will be used to refund NMET.
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