The Prime Minister today reviewed the proposed new Policy on the Mining sector with Sh Sis Ram Ola, Minister Mines, Sh Montek Ahluwalia, Deputy Chairman Planning Commission, Sh TKA Nair, Principal Secretary to the Prime Minster, Shri Subirami Reddy, Minister of State for Mines, Shri Anwarul Hoda, Member, Planning Commission, and officers of the Ministry of Mines and PMO.

A high level Committee under the chairmanship of Sh Anwarul Hoda, Member, Planning Commission, had been set up in September 2005 in order to suggest policy changes needed to attract more foreign and domestic investment in the mineral exploration sector. The Committee presented its report in June 2006.

The Ministry highlighted in its presentation that it was drafting a new mining policy, based largely on the recommendations of the Hoda Committee report. The Policy proposes to reorient the mining concession dispensation to attract investment and technology into the mining sector on a vast scale. India's geological setting promises substantial treasures underground and the country's inability to explore even a small fraction of the area conducive to minerals is identified as a major bottleneck in the way of developing the mining sector. The new policy, based on unbundling and seamlessness in the grant of concessions, expects to attract investors of risk funds and mining juniors specializing in prospecting with state-of-art technologies to search out the mineral wealth of the nation. As a revenue source for the mineral rich states the policy proposes to introduce an ad valorem based royalty regime moving away from the tonnage regime presently in operation. On the environment front a special study group will develop a Sustainable Development Framework based on the internationally accepted model. The main feature of this model is the regeneration of bio-diversity disturbed by mining interventions in addition to honouring the stakeholder interest of host populations like the tribals.

On the controversial issue of export of iron ore it was informed that a Committee of Secretaries is examining the matter. An early resolution based on the recommendations of the Committee is expected.

The Prime Minister directed the Mining Minister to urgently sort out the differences between the Centre and the mineral rich states on the issues of value addition and delays in the grant of concessions by the states. The Mining Minister would consult with the Chief Ministers of the dissenting states on these matters.

The Prime Minister desired that the new policy be brought before the cabinet at the earliest, after a thorough examination of all the contentious issues. The requisite statutory amendments should be targeted for the winter session of Parliament.