Government Set to Auction 20 Critical Mineral Blocks by June-End, Ministry of Mines Secretary Reveals

This pivotal announcement was disclosed by the Ministry of Mines Secretary, V L Kantha Rao, who gives emphasis to the government’s proactive stance towards leveraging mineral resources to fuel an environment of sustainable development and economic growth.

30 April 2024

By Ishika Kumar

In a collective effort to raise India’s mineral sector and meet the burgeoning demand for critical minerals which are crucial for clean energy technologies, the government is set to auction approximately 20 critical mineral blocks in an upcoming fourth round, concluding by the end of June. 

This pivotal announcement was disclosed by the Ministry of Mines Secretary, V L Kantha Rao, who gives emphasis to the government’s proactive stance towards leveraging mineral resources to fuel an environment of sustainable development and economic growth.

Rao revealed that the auction process for seven critical mineral blocks, which was initiated in the first round, is nearing completion, with the outcomes scheduled to be declared and anticipated within a month. These critical minerals, including copper, lithium, nickel, cobalt and rare earth elements, serve as indispensable components in the various rapidly growing clean energy technologies, inclusive of wind turbines, electricity networks or grids and electric vehicles. As the world transitions towards cleaner energy sources, the demand for these minerals escalates, accentuating the need for sustainable procurement ways and usage.

During an event shedding light on the significance of critical minerals, Rao highlighted the government’s proactive approach towards mineral exploration and auctioning. With 38 critical mineral blocks already auctioned and over 100 more slated for future auctions, Rao pointed out the ample opportunities available for industry stakeholders to engage with and invest in the mineral sector. He extended a cordial invitation to the industry to meticulously evaluate these blocks and encouraged them to actively participate in the forthcoming auctions, scrutinise these offerings and partake in the bidding process, thereby fostering a conducive environment for extensive industry engagement and sustainable mineral extraction. 

Moreover, Rao addressed inquiries concerning the government’s stake in Vedanta Group’s Hindustan Zinc, reaffirming the government’s intent to offload its minority stake of 29.54% through an Offer for Sale (OFS). However, he underlined the importance of conducting preliminary market assessments and gauging investor sentiment before proceeding with the OFS through investor outreach initiatives. This cautious approach ensures the government’s commitment to maximising returns from strategic investments and optimising shareholder value.

In response to queries regarding Hindustan Zinc’s proposed demerger, Rao clarified that the government has not endorsed the proposition, signalling a divergence in perspectives between stakeholders. Despite Hindustan Zinc’s endeavours to segregate its businesses into distinct entities to enhance market capitalization, Rao emphasised the government’s reservations regarding the feasibility and implications of such a restructuring. 

Additionally, he shed light on the government’s plans to commence the auction of offshore mines within the next three months, thereby broadening the spectrum of opportunities within the mining domain. This strategic initiative is indicative of the government’s unwavering resolve to harness the untapped potential of the mineral sector, foster innovation and propel sustainable economic growth affirming its commitment to the OFS route as well.

Amidst these developments, industry giants such as Vedanta, Coal India and Ola Electric have showcased keen interest in bidding for critical mineral blocks, implying the reality of heightened industry enthusiasm towards mineral exploration and acquisition. Rao reiterated the government’s commitment to facilitating a conducive environment for industry growth and innovation, talking about the need for proactive industry engagement to unlock the full potential of India’s mineral wealth.

In conclusion, the government’s proactive endeavours in the realm of mineral exploration and auctioning exemplify its steadfast commitment to fostering sustainable development and economic prosperity. By leveraging critical mineral resources and adopting a pragmatic approach towards stakeholder engagement, the government endeavours to propel India towards a sustainable and prosperous future anchored in clean energy technologies. Furthermore, Rao disclosed the imminent commencement of offshore mines auction within three months.