India to Step Up Gold Mining

21 November 2007 :

India has asked its top geological agency to explore additional reserves of 20,000 tonnes of gold and diamonds in several states in a bid to reduce the country’s dependence on imported bullion. Minister of State for Mines, T. Subbarami Reddy recently asked the apex Geological Survey of India (GSI) to explore additional reserves of gold and diamonds in states of Andhra, Karnataka, MP, West Bengal, Rajasthan, Bihar and Chattisgarh.

Reddy’s instructions come in the wake of plans that India is mulling to reduce the country’s dependence on imported bullion, particularly when estimated reserves are expected in the identified states. Officials said the ministry has given a minimum time limit of three years to GSI. Currently, India is estimated to have 14,000 tonnes of gold and diamond reserves which Reddy said should be accelerated by 20,000 tonnes in next three years.

The mines ministry has also accorded the public sector company Hindustan Copper Ltd. To diversify into gold and diamond mining in collaboration with leading foreign companies through setting up of joint ventures with equal equity stake. The overseas firms that are in talks with the government for gold and mining exploration include India Gold, Anglo-American [Nasdaq:AAUK], Monarch Gold Mining [ASX:MON], De Beers India Ltd., ACC Rio Tinto Exploration Ltd. [NYSE:RTP] and BHP Minerals [NYSE: BHP] and Deccan Gold Mines Limited [BSE: DEGM]

Abundant gold reserves are found in India and that is why these companies are being roped in so that minimum 20,000 tonnes of gold and diamond is explored by 2010. The Indian government is taking all initiatives to channelise efforts in unearthing high value minerals like gold and diamonds. Despite abundant reserves of gold and other minerals, India imports Rs65,000 crore ($16.5 billion) worth gold per annum as against Rs75,000 crore ($19.1 billion) of diamond imports.

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