THE NATIONAL MINERAL POLICIES
The first National Mineral Policy (NMP) was declared in 1990, but after the announcement of Statement of Industrial Policy (SIP) in July-1991, NMP of 1990 became inconsistent with the SIP. Therefore, a fresh NMP was announced in March-1993. This policy statement was further put into executive action with legal framework by amending the MMRD Act on 25/01/1994. It had more stress on induction of foreign technology and foreign equity participation in exploration and mining for high value and scare mineral and encouragement of foreign equity investment in joint ventures in mining.
Although the liberalisation of the mineral sector is now over a decade old, the results have not been encouraging. In the Mid-Term Appraisal of the Tenth Five-Year Plan, it was observed that the main factors responsible for this were procedural delays in the processing of applications for mineral concessions and the absence of adequate infrastructure in the mining areas. To go into the whole gamut of issues relating to the development of the mineral sector and suggest measures for improving the investment climate the Mid-Term Appraisal had proposed the establishment of a High Level Committee. Accordingly, the Government of India, Planning Commission, constituted a Committee on 14 September 2005. under the Chairmanship of Shri Anwarul Hoda, Member, Planning Commission
The Hoda Committee studied the various reports prepared and submitted by study groups and in- house committees set up by various Ministries from time to time on the issues before the Committee. The Committee gave consideration to the mineral policies of the States as presented by the State Governments, especially to the differing perceptions of mineral-rich and non mineral-rich states. The Committee also gave consideration to the papers prepared by FIMI, which provided comparative analyses of the mineral policies and statutes of other major mineral producing countries in the world such as Australia, Canada, Chile, and South Africa,the changes in these policies and statutes over time, and the lessons that could be drawn from them. In the Committee, there was a strong sense that the NMP would have to be revised to attune it to the current realities in the world economy in which barriers to international trade and investment flows have been rapidly dismantled. The policy would have to provide for the mining laws and practices to evolve in order to adapt to international best practices. While the GSI and MECL need to be strengthened to enlarge their activities using state-of-the-art techniques, much of the investment needed for exploration and mining would have to come from the private sector. To induce investment flows, the policy environment would have to change. The procedures for grant of RP/LAPL/PL/ML would need to be made seamless and the holders of these permits and licences accorded security of tenure. The policy should also envisage unbundling of reconnaissance, prospecting, and mining activities to maximise private investment. The policy would have to require an arm’s length to be maintained between the State as a regulator and the State as a commercial entity engaged in mining activities. While enacting legislation and drawing up rules and guidelines the States should ensure harmony with Central laws and national policy. The policy should provide for disposal of fully prospected ore bodies through public tender/auction to the extent possible. Equally importantly, the Policy should provide for environmental concerns and the needs of local communities to be fully taken into account in mining operations.The Committee made detailed recommendations on all of its terms of Reference in December 2006 .Based on the recommendations of the High Level Committee, in consultation with State Governments, the Government replaced the National Mineral Policy, 1993 with a new National Mineral Policy on 13 March 2008.
The National Mineral Policy 2008 provides for a change in the role of the Central Government and the State Governments to incentivize private sector investment in exploration and mining and for ensuring level playing field and transparency in the grant of concessions and promotion of scientific mining within a sustainable development framework so as to protect the interest of local population in mining areas.