The Indian government has embarked on its first-ever auction of offshore mineral blocks, marking a significant stride in the country’s efforts to harness its undersea mineral wealth.
The Ministry of Mines launched the initiative on Thursday; offering 13 blocks covering across the Arabian Sea and Andaman Sea for exploration and development. This milestone puts India with one of the few nations participating in the offshore mining process.
This sale consists of three blocks of construction sand in Kollam, Kerala; three lime mud blocks in Porbandar, Gujarat; and seven polymetallic nodules and crusts near the Great Nicobar Island.
All these resources are strategically located in India’s Exclusive Economic Zone (EEZ), which is more than 2.37 million square kilometers, and offer vast untapped potential for critical minerals such as cobalt, nickel, copper, manganese, and rare earth elements.
Union Minister of Coal and Mines, G. Kishan Reddy, launched the auction on Thursday, describing it as a “historic milestone” that unlocks India’s blue economy.
“For nearly two decades, there was no progress in offshore mining despite the existence of the Offshore Areas Mineral (Development and Regulation) Act, 2002. This auction paves the way for harnessing the blue economy. With this, India joins an elite group of nations engaged in offshore mining,” he said during the launch event.
Strategic and Economic Significance
Offshore minerals are vital in fulfilling the strategic and economic needs of India. It is seen to take up a very pivotal position as key material demand goes upward from segments of sectors such as infrastructure, renewable energy, and electric vehicle requirements. Some examples would include:
Construction sand would be used in building materials of mortar and concrete within any infrastructure projects.
Lime Mud: It is rich in calcium carbonate and is important for cement production, water treatment, and soil stabilization.
Polymetallic Nodules and Crusts: Rich in cobalt, nickel, copper, manganese, and rare earth elements, these are crucial for advanced technologies, including batteries, wind turbines, and electronic devices.
This initiative supports India’s efforts to reduce its reliance on mineral imports, which are critical to its economic resilience and energy security.
Legislative and Policy Reforms
It comes after the August 2023 amendment to the Offshore Areas Mineral (Development and Regulation) Act, 2002. This amendment will be auctioning off blocks in offshore areas only by means of auctions. Transparency and efficiency in granting production leases and composite licenses for resource exploration shall be ensured.
“The amendment enables the government to streamline processes, making India an attractive destination for investment in offshore mining,” said V.L. Kantha Rao, Secretary, Ministry of Mines.
Environmental and Sustainability Goals
While the potential economic benefits are humongous, the government has stated it is committed to sustainable mining practices. Union Minister G. Kishan Reddy spoke at a time when the emphasis should be on minimizing the environment impact while developing these resources. The initiative will support India’s net-zero commitment by 2070 because it aims to diversify mineral sources and promotes self-reliance in crucial sectors.
India’s foray into offshore mining comes at a time when global demand for critical minerals is expected to rise sharply. Some estimates even suggest that demand will increase eightfold in the coming years. The auction is expected to bolster India’s position in the global mining sector, reduce import dependence, and enhance the availability of critical resources for domestic industries.
These parts of India’s EEZ are believed to hold strong geological potential with gold, diamond deposits nickel, and cobalt within this area. Yet, there is exploration done only about one-third of the available area. Geological Survey of India has submitted more than 30 reports on oceanic mineral resources, whereas the blocks selected for these auctions are considered to have the most economic viability.
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