The committee will suggest policy measures to liberalise the framework and make it attractive for private players, officials told ET. The proposed plan envisages complete mining rights to interested players while imposing a cap on royalty, they said.
The committee includes cabinet secretary Rajiv Gauba, mining secretary Sushil Kumar and NITI Aayog CEO Amitabh Kant, according to people aware of the matter. It is likely to submit its report in few months.
NITI Aayog has already held meetings with Hindustan Copper to apprise it of the shift in the government’s strategy and similar meetings will be held with the National Aluminium Company and the Mineral Exploration Corporation, said one of the officials, who did not wish to be identified.
“The idea is to allocate reserved areas through auction route, besides allowing mining companies freedom to comine other minerals found in the same mining area,” said the official. The committee is likely to propose a cap of 40% of the sale value as per global practices to make mining competitive and attractive to foreign direct investment.
Under current taxes, royalties and levies amount to more than 65% in India, substantially higher than global standards.
The government believes that opening up of exploration in the mining sector will help create employment for 15 million people by 2022-23, as against 10 million currently employed, both directly and indirectly.