Special Correspondent

‘Aim is to optimise mineral potential by scientific prospecting’

No new licences will be granted to export minerals without value addition

Renewal of licences for exports ruled out

BANGALORE: With illegal mining and the money earned from it becoming a major political issue in the State, the State Cabinet on Thursday approved a new Karnataka State Mineral Policy, 2008, to promote transparency in granting mining concessions and maximising value addition to the minerals extracted, apart from encouraging investment in downstream industries.

Minister for Rural Development and Panchayat Raj Shobha Karandlaje told presspersons that the new policy had 13 major objectives, including progressive features such as adoption of modern techniques in mining, transparency in granting mineral licences and emphasis on value addition.

No new licences would be granted to export minerals without value addition.

The Government also ruled out renewal of existing licences for exports, although companies which have already obtained licences would be allowed to export minerals.

Court order

Karnataka has the distinction of being one of the few States to formulate a mineral policy in 2000.

In a recent order, the Karnataka High Court suggested nationalisation of iron ore mining, besides banning mining in forest areas. Former Chief Minister H.D. Kumaraswamy had ordered a Lokayukta probe into all “illegal mining” deals from January 1, 2000 to 2006.


Ms. Karandlaje said the main objective of the policy was to optimise the State’s mineral potential by scientific and detailed prospecting. The State exported 47 million tonnes of iron from Bellary, Bagalkot and Gulbarga districts, she said.

The policy aimed at preserving the flora, fauna and biodiversity and ensuring that the invaluable forest wealth was safeguarded while granting mineral concessions.

The policy allowed carrying out survey to discover mineral resources in the Western Ghats region without disturbing the ecology, she said.

“Mining as a stand-alone industry needs to be encouraged as it provides large-scale employment. It creates value by converting resources into a product.”


Stating that new mineral-based industries should be set up to match the available raw materials, the policy said the industries would generate more employment and spawn auxiliary industries.

Compliance of environment laws by miners would be enforced through the Department of Forests, Ecology and Environment, it said.

Priority would be given to applicants who proposed establishment of industries for value addition within the vicinity of the mineral-bearing areas.

The Minister said the Government would explore the possibility of notifying mineral-bearing areas to avoid clash of interest between mineral exploitation and other development activities. It would promote indigenous utilisation of iron ore fines and beneficiation of low grade ores.

To ensure better quality of life for mine workers and their families, adherence to minimum wages and other statutory requirements as per the law would be enforced. Townships nearer to the workplace would be developed with health, educational, recreational and other facilities.

A portion of the revenue generated from mining would be used for development of mining areas and districts, the policy said.