The Indian cabinet has approved an amendment in the mines and minerals law that will allow transfer of captive mining leases not granted through auctions, the government said in a statement.
Transfer of captive mining leases under the amendment to the Mines and Minerals (Development and Regulation) Act, 1957 (MMDR Act, 1957), granted otherwise than through auction, would allow mergers and acquisitions of companies and facilitate ease of doing business for companies to improve profitability and decrease costs of the companies’ dependent on supply of mineral ore from captive leases, the statement said.
It said the transfer provisions will also facilitate banks and financial institutions to liquidate stressed assets where a company or its captive mining lease is mortgaged.
The law earlier restricted the scope of transferability of concessions granted through auction. It was restricting the mergers and acquisitions of companies and was impeding the ease of doing business for companies dependent on supply of mineral ore from captive leases.