India Launches First E-Auction of Offshore Mineral Blocks
On November 28, 2024, India took a significant step in its mining sector by launching the first-ever e-auction of mineral blocks in offshore areas. The event was inaugurated by Shri G. Kishan Reddy, the Union Minister of Coal and Mines. This initiative marks a pivotal moment in India’s efforts to explore and utilize its vast offshore mineral resources located within its Exclusive Economic Zone (EEZ). The auction is expected to enhance India’s mineral security and support the country’s ambitions for energy and industrial self-reliance.
Overview of the Auction
The inaugural tranche of the auction includes 13 mineral blocks located in the Arabian Sea and the Andaman Sea. These blocks feature a variety of minerals, including construction sand, lime-mud, and polymetallic nodules and crusts. These resources are essential for infrastructure development, high-tech manufacturing, and the transition to green energy. The auction aims to tap into these critical minerals, which are increasingly in demand as India seeks to bolster its industrial capabilities.
The auction process will begin with the sale of tender documents on December 3, 2024. Bidders will have until the end of February 2025 to submit their bids. The auction will be conducted online through a transparent two-stage ascending forward auction process. The highest bid, based on the percentage of the mineral value, will secure the winning bid. Detailed information regarding the mineral blocks and auction terms can be found on the MSTC auction platform.
Significance of Offshore Mineral Resources
The launch of the e-auction is a historic moment for India’s mining sector. It reflects the government’s commitment to reducing reliance on imported minerals and enhancing domestic production. Shri G. Kishan Reddy emphasized that the demand for critical minerals is expected to rise significantly in the coming years. He stated that India is making concerted efforts to become a leading player in the global critical minerals market.
The auction is also aligned with the vision of Prime Minister Narendra Modi for a “Viksit Bharat” (Developed India). The government plans to introduce a National Critical Mineral Mission soon, aimed at strengthening supply chains for critical minerals within the country. This initiative is expected to foster sustainable mining practices and enhance capacity-building efforts in the sector.
Government Support and Industry Participation
During the launch event, Shri V. L. Kantha Rao, Secretary of the Ministry of Mines, highlighted the extensive efforts made by the Geological Survey of India (GSI) over the past 40-50 years to explore mineral resources in the seabed. GSI has identified approximately six lakh square kilometers of offshore area with potential for mining. All exploration data generated by GSI is accessible through the National Geological Data Repository (NGDR) portal.
The government has set reasonable royalty rates for offshore minerals to encourage industry participation. The selected blocks for auction have been carefully chosen to attract bidders. The Minister called upon industry stakeholders to actively participate in exploration, mining, and technology development. This collaboration is crucial for making India a global powerhouse in the offshore mining sector.
Future Prospects and Commitment
The government of India is committed to maintaining momentum in the offshore mining sector. More mineral blocks will be auctioned in a phased approach to support India’s ambitions for mineral security, technological advancement, and sustainable development. The launch of the e-auction is just the beginning of a new era in offshore exploration, as stated by Union Minister Shri G. Kishan Reddy.
As the auction progresses, it is expected to diversify India’s mineral sources and reduce import reliance. This initiative will play a vital role in securing essential resources for various sectors, including infrastructure and electric vehicle manufacturing. The government’s proactive approach aims to ensure that India remains competitive in the global minerals market while promoting sustainable practices in the mining industry.
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