Mines ministry proposes overseas listing of exploration firms

NEW DELHI: Concerned over inadequate fund flows into the mining sector, the Mines Ministry has proposed allowing domestic exploration firms to raise funds abroad by listing equity-linked securities.

The Ministry of Mines has also suggested facilitating venture capital investment and listing of early stage exploration companies.

"Venture capital flows to be facilitated by bringing concepts of flow through shares, alternate platform for listing of early stage exploration, allowing Indian exploration companies to issue GDRs without prior testing in India," the ministry said outlining its long-term goal for raising investment in mining exploration.

A group has already been formed to make recommendations on the issue.

"Investments in exploration are still grossly inadequate despite the geological potential. Both in terms of the data generation by the national survey organisation and in terms of a concession framework and access to capital for exploration, there are huge inadequacies which need to be addressed to provide the requisite investor confidence," it said.

Calling for improving regulatory systems, the Mines Ministry observed that both the exploration and mining regulatory systems at the central level and at the state level were inadequate.

"Illegal mining and unscientific mining are symptoms of a failure of the regulatory system in all its aspects, including proper exploration, scientific mining in accordance with mining plans, adoption of benefaction practices, royalty accounting, etc," it said.