The concentration of 2gm per tonne is at par with leading platinum mines in South Africa, Russia, USA and Zimbabwe, the countries that account for bulk of the platinum production of the world, GSI officials said. GSI director-general SK Acharyya said: "The Baula-Nuashahi reserve can be called a model reserve".

He said this is the first instance in South and South-East Asia that gold has been found along with the platinum group of metals. Some countries in South-East Asia and even some leading platinum producers have shown keen interest in the geological features of the reserve.

Platinum, called a strategic metal, has a wide range of uses, from photography and jewelleryto computers. Platinum alloy is used in computer memory devices and lasers. Because it is inert to acids and fire, it is used to make chemical apparatus and electric furnaces.

Last year, India imported about 1400kg of platinum.Palladium is used principally in catalytic converters -- devices that help control automobile and industrial plant emission.

With the Indian government having told all carmakers to meet Euro 2 emission norms, demand for palladium is expected to shoot up.

"Apart from platinum and palladium, we recently explored three promising gold reserves at Sonegiri in Andhra Pradesh, Nagpur in Maharashtra and Jabbalpur in Madhya Pradesh.

The Sonegiri reserve is estimated at around 0.70 million tonnes with gold concentration of 6gm per tonne, which is fairly rich. GSI officials said there are mines in leading gold producers like South Africa operating at concentrations of 3gm per tonne.

The new gold finds are considered promising, as the ancient mines at Kolar and Hutti have beenpractically exhausted. According to a report by the Federation of Indian Mineral Industries, last year India's gold production was around three tonnes against imports of 46 tonnes.

Currently, Indian gold production is 0.1 per cent of the world total, according to the GSI.