Source: The post is based on the article “Draft Mineral Auction Rules,2023: Single bidder allowed in second attempt” published in “Business Standard” on 22nd November 2023
Why in the News?
Government of India has released the Draft Mineral (Auction) Second Amendment Rules, 2023.
What are the key provisions of Draft Mineral(Auction) Second Amendment Rules, 2023?
| Specifications | Details |
| Changes in Mining Contract Auction Rules | 1) First round of bidding still requires a minimum of three bidders. If fewer than three technically qualified bidders, the first attempt of the auction gets canceled. 2) But for second auction, the proposed amendment allows the contract to be given even if only one technical bidder participates. 3) This is done to streamline the process especially when participation is limited. |
| Prohibits affiliate bidders | The rules prohibit any affiliate associated with a bidder from submitting bids in the same auction where the bidder has already placed a bid. |
| Oversight Committee | The State governments are required to establish a committee to identify suitable areas for granting exploration licenses within the state. |
| Ceiling Price | State governments must define the maximum percentage share known as the ‘ceiling price,’. Ceiling price is the percentage of revenue to be shared with the government. The ceiling price set by the government should not be less than 25%. |
Are private players allowed in exploring minerals?
1) Recently, the Government of India gave permission for private sector involvement in exploring important and deeply embedded minerals in the country.
2) Both national and international private mining companies, known as junior explorers, are allowed to take part in risky exploration ventures.
3) This has been done as there is a lack of expertise among existing players in mining deeply embedded minerals.
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