In a letter to mines minister Bijoy Krishna Handique, steel minister Virbhadra Singh had demanded that state-owned companies should not be made to bid for mining projects and instead specific quantity of mineral resources should be reserved for them as it is done for the coal sector. Steel ministry has 10 PSUs under its administrative control, which includes Navaratnas like steel producer SAIL and NMDC, which is engaged in exploration of iron ore, copper, rock phosphate, lime stone, dolomite, gypsum, bentonite, magnesite, diamond, tin, tungsten, graphite and beach sands.
In his reply, mines minister Bijoy Krishna Handique maintained that coal is a nationalised mineral and is governed by a different set of criteria. We have, accordingly made suitable provisions in section 13 of the draft Act which moderates the (bidding) procedure through weightage to techno-economic factors, particularly in relation to PSUs, Handique wrote. The mines minister also added that there would be additional weightage to issues like beneficiation, end-use, captive mining and long-term ore linkages in the new mining regime.
We feel that this section and other provisions (of the draft MMDR Act) adequately protect PSUs whose mineral resources are likely to be exhausted in the near future,. Defending the new bidding regime under the proposed MMDR Act, Handique pointed that even his ministry has PSUs under its administrative control.