The Johannesburg-based De Beers Consolidated Mines Ltd is setting up a wholly owned subsidiary-De Beers India Exploration Pvt Ltd-with an initial investment of $30 million (over Rs 130 crore). The investment is being made through its Mauritius-based subsidiary.

In its proposal to the Government, De Beers has stated that the initial investment of $30 million is being made for prospecting, evaluation and trial mining phases and thereafter investment may go up to $400 million. The firm initially proposes to conduct prospecting operation in Maharashtra. In case the company locates deposits of other minerals (except those reserved for public sector), it will go in for mining either though itself or with suitable JV partner, according to the proposal.

While clearing the proposal for setting up of a wholly-owned subsidiary, the FIPB, on the advice of the department of mines, has attached a rider that if the company wished to mine diamond and precious stones with foreign direct investment of more than 74 per cent, it would need to take a prior approval from FIPB. In the case of Hindustan Diamond Company, De Beers is acquiring 84,000 shares represeting 30 per cent of the share capital from Bank of Bermuda, an overseas company.