Mineral exports may help attract $1.25 bn FDI

New Delhi, Oct 28 | Updated: Oct 29 2007, 07:02am hrs
The National Mineral Policy (NMP), to be discussed by the the Union Cabinet soon, will have the potential to attract $1.25 billion (about Rs 5000 crore) as FDI in next five years, but the government will have to allow export of minerals, including iron ore, to ensure the same.

A long-term export policy would provide stability and prove to be an incentive for investing in large-scale commercial mining activity. Assurances on export of minerals will be a key factor for investment decisions, particularly on FDI in the sector, the mines ministry said in a note to the government.

It said to develop mining as a modern, stand-alone industry, investment is required, and the export policy should be based on a clear, long term strategy taking into consideration the export of minerals .

Pointing out that minerals continue to be an important source of foreign exchange earnings, the note, however, suggested that the export policy should keep in view the dynamics of mineral inventories as well as the short, medium and long-term needs of the country.

Efforts shall be made to export minerals in value-added form as far as possible. The indigenous mineral industry shall be attuned to the international economic situation to derive the advantage from foreign trade by carefully anticipating technology and demand in the international market for minerals, it observed.

PTI