home Economy India to auction 3 Gold Mines to Private Sector, in a bid to slash Imports

India to auction 3 Gold Mines to Private Sector, in a bid to slash Imports

This year, the Indian government will auction at least three gold mines, opening up the sector to private firms for the first time ever! This move will help the country to slash imports of the metal, that amounted ~$36 billion last year, as government cost.

According to Mines Secretary Balvinder Kumar, “India now plans to auction at least three gold mines in 2016 with billions of dollars worth of estimated reserves, including Kolar in the southern state of Karnataka that was shut 15 years ago on high costs”

Of the mines to be auctioned, two are new and located in the eastern states of Jharkhand and Chhattisgarh, with combined gold ore reserves estimated at up to 3 million tonnes. Gold ore typically yields 0.0005-0.001 percent of primary metal.

India Gold Imports
India Gold Imports

There have already been shipments of up to 1,000 tonnes of gold annually and in an attempt to reduce this, the govt has already hiked the import duties and launched a scheme to mobilize a pool of over 20,000 tonnes of the metal lying idle in homes and temples.

However, due to insufficient local produce, the government has failed to curb imports by the World’s second-biggest consumer, where gold is regarded as the highest form of gift for gods and humans alike.

It is believed that the Indian billionaire Anil Agarwal’s Vedanta Resources and mining major Rio Tinto could be interested in these auctions.

Source: Reuters News