India is all set to go for a gold hunt now. Concerned over its increased dependence on bullion imports, government of India has asked Geological Survey of India (GSI) to tap the countries potential to dig out gold and diamond reserves spread over several states.
India is estimated to have 20,000 tonnes of gold and diamond reserves spread over several states. The Indian government has asked GSI to explore additional reserves of gold and diamonds in Andhra Pradesh, Karnataka, Madhya Pradesh, West Bengal, Rajasthan, Bihar and Chhattisgarh.
India has been the top importer of gold for several years and the Indian government is concerned over its over-dependence on imports for its bullion needs.
The concern increased during the recession time when prices of gold shot up beyond $1,000 per ounce in the international markets. Moreover, gold has become the safest have available for investors at present.
The government has given GSI three years to explore the possibilities to tap the gold reserves. Now, India is estimated to have 14,000 tonnes of gold and diamond reserves which should be accelerated by 20,000 tonnes in next three years.
The government 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.
The overseas firms that are in talks with the government for gold and mining exploration include Indogold, Anglo-American Gold Mining, Monarach Gold Mining, De Beers India Ltd, ACC Rio Tinto Exploration Ltd and BHP Minerals.
The Indian government is taking all initiatives to channelise efforts in unearthing high value minerals like gold and diamonds. India imports Rs 65000 crore worth gold per annum as against Rs 75000 crore of diamond imports.
India currently produces hardly 0.4% of its gold consumption despite having 9% of global gold reserves under the country's land mass.
Foreign companies rarely come to India because they cannot sell the data they map and can only utilise the information if they venture into mining themselves. Under the existing rules if any entrepreneur invests money and finds gold, then he must apply again for mining.
However, the new mining policy is expected to open up the mining sector for foreign investment. Under the new rules, approvals for most minerals must be made in about a year or be automatically referred to a tribunal.
International gold mining companies are looking for tying up with gold exploration firms in India to form joint venture and launch new exploration projects.
Southern India's Deccan region has been surveyed as having one of the richest deposits of the yellow metal.