TAG: GS 3: ECONOMY
THE CONTEXT: India, under the leadership of Mines Minister, has initiated the second phase of its critical minerals auction, a significant economic move with an estimated worth of 30 trillion rupees (approximately $362 billion).
EXPLANATION:
- This strategic auction aims to tap into the vast mineral potential across the country, with a focus on essential elements like tungsten, vanadium, cobalt, and nickel.
- The auction encompasses 18 critical mineral blocks spread across eight states, namely Chhattisgarh, Madhya Pradesh, Karnataka, Maharashtra, and Rajasthan.
- These states are poised to play a pivotal role in India’s mineral landscape.
- Seventeen of the mineral blocks are designated for a composite license, allowing comprehensive exploration and subsequent mining. Additionally, one block is specifically allocated for a mining lease.
- The chosen states reflect a diverse geographical spread, showcasing India’s rich mineral deposits across different regions.
- This strategic approach ensures a balanced and comprehensive exploration of critical minerals, contributing to the nation’s economic growth.
Inclusive Exploration Licenses:
- As part of the auction, five states – Maharashtra, Madhya Pradesh, Haryana, Chhattisgarh, and Rajasthan – will conduct auctions for exploration licenses dedicated to critical minerals.
- This nuanced approach emphasizes the importance of thorough exploration before mining activities commence.
Participation and Bidders:
- In the initial round of the first part of auctions launched in November the previous year, the government garnered substantial interest with 56 bids from various entities.
- Notable participants included Vedanta Ltd, Coal India, Shree Cement, Ola Electric, Dalmia group, and Jindal Power.
- This diverse range of participants highlights the cross-industry interest in securing access to critical minerals.
- The second round of bidding for the first tranche of auctions is scheduled for mid-March, with the bid winner announcement expected in mid-April.
- This structured timeline ensures a transparent and efficient process, fostering a competitive environment among bidders.
Critical Minerals:
- Critical minerals are those minerals that are essential for economic development and national security, the lack of availability of these minerals or concentration of extraction or processing in a few geographical locations may lead to supply chain vulnerabilities and even disruption of supplies.