The Geological Survey of India discovered two regions that contain high amounts of gold and platinum. Further details were disclosed in a press conference at the GSI head office in Hyderabad, according to Additional Director General GSI, Southern Region, the deposits are a good sign for India which largely imports bullion at a high gold rate from other countries.
The two major deposits were found in Ajjanahalli Block C in Karanataka and Tasampalaiyam in Tamil Nadu, containing heavy amounts of gold and platinum. Other resources that were found in appreciable quantities include limestone in Andhra.
In order to make such discoveries more frequent, the Indian government needs to adopt modern technology, the latest techniques and talent from both domestic and local markets in order to create a strong synergy between different organizations to continue making rapid discoveries.
To make the process easier, the geological maps of every state in India are now made available free of cost to both private and public agencies. These maps are crucial in the discovery of more gold mines in India and will hopefully bolster the local bullion industry.
India is currently embroiled in a major trade deficit of over $28.6 billion per year. The majority of commodities imported by India include gold, diamond, bauxite, copper, silver and other minerals. What’s so ironic to experts is the availability of valuable mineral deposits scattered throughout India.
The lack of bullion production in India is largely attributed to the controversial MMDR Amendment Act which prevents private institutions from making mineral discoveries in the country, putting the responsibility of carrying out ‘discoveries’ with the government. Mining companies can only begin production after they win the mine through a frustrating e-auction process.
The government hasn’t proven to be too competitive when it comes to discovering new mines. Very few mines were discovered since their Greenfield exploration programme, with progress primarily coming from 1998 to 2008 when the private sector was finally given permission to make new discoveries of precious metals such as gold, diamond and other rare metals
Geologists believe that India is a treasure trove of gold, yet only 1.61 tonnes of gold were mined during the years 2017 to 2018. India’s closest neighbor, China, which shares roughly the same terrain used to produce 3 tonnes of gold in 1994. But growing commitment from the government to support local mining industries has seen China push through several barriers, and now produces over 450 tonnes.
So what’s stopping the gold mining industry in India? Politics.
An amendment was made to the Mines and Minerals Act 1957 by the Indian parliament which allowed companies to bid for mining licensee through a complicated e-auction process. Mining leases were only given for 50 years with a flat 4% royalty on gold revenues. Companies that own the gold mines are also required by law to contribute to the National Mineral Exploration Trust and District Mineral Foundation.
With total royalties amounting to over 5.28% regardless of gold revenues made, it is no wonder why the domestic mining industry is lacking.