ANDHRA PRADESH STATE MINERAL POLICY 2013

INDEX

S.No. Subject Page

Introduction
Objectives
1. Survey & Exploration
2. Estimation of Mineral Resources
3. Strengthening of Mineral
Administration
4. Grant of Mineral Concessions
5. MoUs & JVs enter into by State
Government & Public Sector
Undertakings
6. Scientific and Systematic Mining
7. Minor Minerals
8. Prevention and Control of Illegal
Mining and Transportation
9. Mineral Based Industries
10. Implementation of the Policy

I. INTRODUCTION:

Andhra Pradesh occupies an area of about 2,76,800 Sq.Km and has a long coast-line of
960 Km spreading from Ichapuram in Srikakulam District in the North to Tada in Nellore
District in the South. The State is bounded by Latitudes 12037’ and 19054’ North and
longitudes 76046’ and 84046’ East.

Physiographically, the State is divisible into three natural units from East to West. These
are i) Eastern Coastal plain interspersed with Delta (ii) Eastern Ghats, the Nallamala and
Erramala Hill Ranges and (iii) Deccan plateau dotted with hill ranges in the North.

Administratively, the State is divided into 23 Districts and regionally into Coastal,
Rayalaseema and Telangana Regions.

Minerals are valuable natural resource being the vital raw material for infrastructure,
capital goods and basic industries. The endowment is finite and non-renewable. Hence,
the exploitation of minerals has to be guided by long term National Goals and
Perspectives. The State Mineral Policy is an integration of National Mineral policy. The
main aim of the State Mineral Policy is to serve as a guiding force to translate the State’s
Mineral Potential into reality with the objectives of eco-friendly and sustainable mining.

II. GEOLOGICAL CONTEXT:

Geologically, the State forms a part of Peninsular India and is one of the most ancient
land masses. The geological formations of Andhra Pradesh range from the most ancient
to the recent. The State consists of igneous, Metamorphic & sedimentary formations. The
Peninsular Gneissic Complex consists of Archaean Group covered by complex
group of Gneisses and Schists. The Precambrian Sedimentary formation of the
Cuddapah Super Group, Pakhal Super Group and Kurnool Group found in Kurnool,
Cuddapah, Ananthapur, Chittoor, Nalgonda, Mahabubnagar, Guntur, Krishna and
Khammam Districts. The Bhima’s are found in the western part of Rangareddy District.
The Gondwana Super Group is found in Khammam, Warangal, Karimnagar and
Adilabad Districts. The Deccan Traps are found in Rangareddy, Nizamabad, Medak,
Adilabad, East and West Godavari Districts. Outcrops of Tertiary formations are found in
East and West Godavari and Visakhapatnam Districts and the Quaternary sediments as
thick blankets of alluvium are found in the River Valleys, Deltas and along the East
Coast.

III. MINERAL RESOURCE:

Andhra Pradesh’s varied geology has rich and wide variety of minerals for many mineral
specific industries. It is a store house for 48 minerals and more specifically for Gold,
Diamond, Bauxite, Beach Sand, Limestone, Coal, Oil & Natural Gas, Manganese,
Dolomite, Quartz, Feldspar, Precious & Semi-precious stones, Clays, Calcite, Steatite
Iron Ore, Base Metals, Barites, Uranium, Granite, Limestone Slabs, Marbles,
Dimensional Stones and other Building Minerals.

The State with vast mineral potential has worked out certain strategies to explore, exploit
and develop the mineral sector with the constructive co-operation of both private and
public sectors. The State has focused on the inventory of mineral resources, key issues of
legislation, objective & strategies in tune with the National Mineral Policy in accelerating
the growth in the liberal regime and thereby leading to overall development of the Mining
Sector.

THE STATE MINERAL POLICY – 2013

1. OBJECTIVES:

The Andhra Pradesh Mineral Policy has the following objectives:

• To create favorable environment for value addition of the minerals in the State.
• To enhance employment opportunities.
 • To explore mineral wealth of the State by adopting modern exploration
techniques with a priority for strategic minerals like sand, iron ore, limestone and
base metals.
• To promote mechanized and scientific mining keeping in view the environmental
measures and mineral conservation.
• To promote development of human resources for meeting the requirements of
mining and mineral based industries.
• To de-mystify procedures and achieve greater transparency in decision making.
• To strengthen infrastructural facilities in mineral bearing areas with special
emphasis on linking existing infrastructure.
• To promote prospecting and mining of noble and base metals, fertilizer and
industrial minerals.
• To simplify the rules and procedures to remove the hurdles and bottlenecks and to
provide clarity in the interest of mineral development.
• To implement welfare measures for the Mine Workers.
• To introduce “e” governance.
• To encourage utilization of mine wastes/beneficiation of low grade minerals /
ores.

To meet the above objectives, the state will undertake the following jobs:

1. I. SURVEY & EXPLORATION :

1.1 The Directorate shall be equipped with State of the art technologies for
exploration of minerals.

1.2 The Technical staff of the Department shall be trained in latest techniques and
technologies, applicable for exploration of minerals within a time frame.

1.3 The State shall ensure the establishment of training schools in each District
to develop Technical Resource persons having knowledge of Mining Laws and
Regulations for their Employment in the Mines/Quarries to follow the Rules and
Regulations.

1.4 To exploit the State Geological Potential, it shall be ensured that regional and
detailed exploration shall be carried out systematically in the entire geologically
conducive mineral bearing area using the State of the art techniques in a time bound
manner.

1.5 State Geological Programming Board shall be responsible for drawing up

action oriented plans in respect of geological mapping and regional resources assessment
of the State in close co-ordination with all other agencies engaged in this task.

1.6 In the next decade, seabed mining is going to be the prime area for
exploitation of various mineral resources. The State of A.P. endowed with longest coast
line of about 960 Km. Though seabed mining subject falls in the administrative
jurisdiction of Government of India to draw the spin off benefits from seabed mining, the
State Government shall initiate efforts.

1.6.1 The State Geological Board shall direct all efforts in materializing the
opportunities that can be derived from seabed mining.

1.6.2 The Department shall formulate annual and five year rolling plans for
exploration on regional scale to include the plans in CGPB.

1.6.3 The SGPB shall review the work done so far relating to the activity domain of
marine sciences with special references to coastal Andhra Pradesh.

1.6.4 The SGPB shall coordinate the exploration work conducted by Government and
private agencies as per the defined plan objectives and priorities.

1.6.5 The Director shall take active participation in CGPB committee on Marine
Geology and Exploration and Coastal Geosciences.

1.7 State shall strengthen linkages and interactions among the various institutions
engaged in research and development in the mineral sector to derive maximum benefit.

1.8 State shall give emphasis on the use of advanced geophysics and remote
sensing techniques to detect deep seated mineralizations.

1.9 State shall encourage private investments in exploration particularly deep

seated mineralization using advanced state of art technologies.

1.10 Attention shall be given to the survey and exploration of strategic minerals.

2. ESTIMATION OF MINERAL RESOURCES

2.1 It shall be ensured that the applicable United Nations Framework classification
(UNFC) System is fully adopted and utilized for reporting mineral reserves.

2.2 The State Directorate shall liaise with Geological Survey of India and Indian
Bureau of Mines in order to ensure the best possible synergy from the data base.

2.3 The key to attract investment in the mining sector is marking available relevant
information in a way most useful for investment decision making. The State Directorate
shall create and constantly update a website in order to ensure information regarding.

• State policies, Legislation and executive instructions make available to

prospective investor and mining community.

• Availability of areas for prospecting and mining through creation of a Mining

Tenement Registry and Resource Inventory.
 • Geological and Geophysical data in spatial as well as non special formats
including data gathered during reconnaissance and prospecting after lock in
period is over.

2.4 The state will create its own inventory of mineral resources in digitized form by
uploading all the available exploration data in coordination with GSI and IBM. Resource
inventory shall be in accordance with the latest version of the United Nations Frame work
of Classification (UNFC) system. Detailed reports shall also be made available to the
interested investors on cost recovery basis

3. STRENGTHENING OF MINERAL ADMINISTRATION

3.1 The Directorate, Regional and District Offices shall be modernized for better
efficiency and good governance.

3.2 On-line processing of mineral concession applications shall be introduced.

3.3 The rules, policies, important circulars and orders issued from time to time will be
made available at department’s website www.apdmg.org. etc.

3.4 The Regulatory Environment shall be made more conducive to investment.

Deduction of Seigniorage Fee by the User Agency under G.O.Ms.No.23 issued by
I&CAD Dept., shall have to be taken up with the concerned Engineering
Departments at Government level by evolving suitable procedure to ensure
accountability of mineral usage and regulation of mineral mining activity.

3.5 Transparency in allocation of Mineral Concessions shall be assured with security of

tenure a concessionaire.

3.6 State shall actively encourage private investment in exploration and exploitation of
mineral resources.

4. GRANT OF MINERAL CONCESSIONS

4.1 Disposal of mineral concession applications within prescribed time frame of rules
shall be ensured.

4.2 “First in time” and continuity or seamlessness principles shall be fully recognized.

4.3 Principal of seamless transition from reconnaissance permit to prospecting license

and prospecting license to mining lease shall be honored strictly. However, Exemption
of pre-requisition of PL for minerals like Gravel, Ordinary Earth, Morrum,
Building Stone and Road Metal may be considered.
4.4 State shall frame and implement a transparent system of notifying the promising
areas for grant of mineral concessions, and grant concession as per equitable and just
criteria published in the notification.

4.5 In order to ensure that selection of concessionaries in notified areas follows as

transparent and equitable system, it shall be ensured that

• Areas will be notified in a manner so as to reduce fragmentation and sterilization

of reserves.
• To introduce Mining Zone Concept to avoid Urbanization near to the Mining
areas and protect the long term Investments made by the Mining Sector.
• In case of large areas, manageable parcels shall be made.

• Selection of concessionaire shall be made in addition to capacity and capability,

on the basis of captive requirements.

4.6 Priority under Section 11(5) of Mines and Minerals (Development & Regulation)
Act, 1957 shall be on the following grounds:

• Priority shall be given, in sanctioning of minerals concession, to applicants having

mineral based industries in the state but not having leases to feed the industry.

• Who has signed MOU (Memorandum of Understanding) with the State

Government or Undertaking of State Government to establish unit for value
addition of minerals in the State of Andhra Pradesh.
• Mining of mineral resources by using modern technique for minimal losses of
minerals.
• Mineral Specific
• Exhaustion of captive capacity
• Ownership of the land of the recommended area
• Considering an adjoining area for mining in the interest of scientific and
systematic mining and reduction in barrier loss.

• Large investment
• Value addition
• Long term ore linkage etc.,

4.7 To resolve the problems of lessees / licenses in time, joint meetings will be held by
the DMG at the level of concerned JDMG and ADMGs with the mining entrepreneurs
once in 3 months. A special interdepartmental cell will be created in the secretariat to
redress grievances of the mining entrepreneurs.

4.8 Delays in grant of clearances by the Revenue/Forest Departments will be

minimized by monitoring through State Level Co-ordination Empowered
Committee on quarterly basis.
5. MoUs and JV’s enter into by State Government and Public Sector
undertaking.

The Memoranda of understanding and Joint Ventures constituted an important aspect of

the proposals recommended by the State Government in respect of both notified and non-
notified areas. Joint Venture is also an important feature in cases relating to reservation in
favour of PSU.

5.1 State shall ensure not to enter into MoUs for exploitation of mineral resources at a
specific location in anticipation of a concession or a reservation.

5.2 In order to ensure that MoUs and Joint Ventures are not misused and in order to be
eligible to be cited as special reasons, the MoUs and joint ventures related to Section
11(5) of MM (D&R) Act, 1957 should have a general clause in relation to

5.2.1 Prohibition on assigning, sub-letting, mortgaging or in any other manner

transpiring the concession rights without prior approval of Central Government.

5.2.2 Prohibition on change in terms and conditions of the MoU and JV’s without prior
approval of Government of India.

5.2.3 State shall ensure not making changes in management composition and control of
the parties except in accordance with the provisions of the Act and prior approval of the
Government of India.

5.2.4 In case of MoUs where an industry has been setup on the basis of MoU but
mineral concession has not yet been granted as per the MoU, the State shall consider.

• All the MoUs shall be treated as single class for the purpose and ‘first in time”
shall be recommended.

• The first in time principle in the case of MoUs will be reckon on the basis of date
of MoU.

5.3 The Reservation of Mineral bearing areas for exploration by PSUs will be
subjected to the condition that in case the PSU does not itself under take subsequent
exploitation then State Government shall ensure application of following options:

5.3.1 The Mineral Concessions granted through notification of the reserved area, the
application of Section 11(2) & 11(3) of MM(D&R) Act, 1957 shall be ensured.

5.3.2 The Mineral Concession may be granted infavour of public sector undertaking and
involve private sector for exploitation of minerals.

5.3.3 For the Mineral deposits explored by PSUs, the mineral concession may be
disposed of through public auctions.
5.3.4 During the finalization of MoUs/JVs, bidding may be conducted.

6. SCIENTIFIC AND SYSTAMATIC MINING

6.1 There is a need to enforce scientific and systematic mining practice so that, the
precious natural resources are not left un-utilized. For this purpose, the State Directorate.

• Shall endeavor to develop expertise in mining plans and mine closure

management plan.

• Shall ensure that mining activities adhere to the approved mine plans. However,
substitution of mining proposal in place of Mining Plans for less than 5 Hectares
areas may be considered. Further, the Minor Mineral lease holders may be
permitted to get the Mining Plans revised or altered at lower office levels during
the period of validity of the said plans.

• Shall develop expertise in more beneficiation technique and preparation of techno

economic feasibility reports.

7. MINOR MINERALS

The State shall frame a scheme for the proper exploitation of minor minerals addressing
environmental concerns. The indiscriminate Sand quarrying and soil for making earthen
bricks are prime concern in respect of environmental degradation, depletion of ground
water and loss of biologically rich top soils.

7.1 Sand bearing areas of Godavari, Krishna, Penna and their immediate lower order
streams are the main source of quarrying of sand in the State. In delta regions, the Ground
Water exists in unconfined aquifer state, removals of sand have direct and immediate
effect on Ground Water recharge regime.

There is no substitute for sand in construction activity except the sand manufactured
artificially which is popularly known as Robo Sand. For the rough estimates the revenue
collected for the year 2010-2011 on sand is about Rs.120 Crores which is equivalent to
about 30 million Tonnes or about 1100 hectares @ 1.5 Mts depth. It is the pertinent
question does that much sand is replenished annually through floods. On any account the
sand available in the State is going to exhaust in near future and introduction of
substitution for sand at an early date will safeguard the ground water regime. Otherwise
the State is going to invest huge amounts even on supply of drinking water to the public.

7.1.1 On account of exhaustion of sand year after year and ensure sustainable
development the state shall initiate measures for substitution.

• The State shall promote artificial sand manufacturing industry through

promotional incentives to entrepreneurs.
 • The State shall identify and declare exclusive mining zones for sand
manufacturers.

• The Directorate shall identify suitable mineral bearing areas for steady supply of
raw material in major urban centers such as HMDA, Visakhapatnam, Tirupathi
and other non riverline districts.

• The Directorate shall make efforts to validate the vast deposits of quartzites of
Kadapa basin and sand stones of Gondwanas in manufacture of artificial sand as
sand become an exportable commodity in the neighboring states as well as island
nations surrounding the Indian Peninsula.

• State shall ensure usage of manufacture sand in all Government and quasi
Government works as an alternative to natural river sand in a phased manner
depending on capacity building of manufacture sand units.

7.1.2 Since inception of Harappa civilization the Burnt Earthen Brick become a
building stone in construction activity. But, in modern times, the construction activity has
grown in many folds and to meet the demand, it obliges to remove top soil over hundreds
of acres of fertile agricultural lands which is going unaccounted till to date. Fly ash brick
possess all engineering as well as aesthetic values as good as earthen brick. Fly ash bricks
are perfect substitution for conventional earthen bricks. In the absence of sufficient
promotional campaigns, the usage of fly ash brick in construction activity not gained
momentum. There is a misnomer in the eyes of the public that the hollow bricks and fly
ash bricks are one and the same. Because of this misconception, the fly ash bricks not
gained sufficient demand. Keeping in view of the ash generated from the existing as well
as Coastal Green field thermal power projects, promotion of Fly ash brick industry
become more eco-friendly measure to attain the goal of sustainable development.

To protect the productive top soils and for clean environment, the State shall initiate
measures in promoting substitution of fly ash bricks replace of conventional bricks.

• The State shall promote fly ash brick industry through promotional incentives for
entrepreneurs.

• The State shall ensure promotional campaign and use every platform in the public
domain for promotion of fly ash brick industry.

• The State shall ensure all administrative measures for study supply of raw
material (Fly ash) to the manufacturers as a protective measure from cement
industry.

8. PREVENTATION AND CONTROL OF ILLEGAL MINING

AND TRANSPORTATION
8.1 Existing rules shall be made more stringent.

8.2 Granting and Renewal of Mineral Concessions to Defaulters and offenders shall
not be consider.

8.3 Mineral Concessions shall not be granted to the persons having criminal
background and antecedents are to be obtained before grant of Lease.

8.4 Identification of mineral bearing regions which are persistently prone to illegal
mining for deploying special squads. The Integrated Check Posts shall be planned at
Vulnerable places containing Mining, Commercial Tax, Transport and Police
Departments as they are inter-related in terms of Revenue earning Departments to
the State.

8.5 Weighing machines and check posts shall be setup in coordination with other
departments on main routes of the State to ensure effective vigil.

8.6 System of e-permits shall be developed in the phased manner for transportation of
minerals.

8.7 High-Level resolution satellite data shall be used to detect illegal mining.

8.8 Auditing of mineral reserves shall be initiated in case of bigger mines/quarries by

charted accountant.

8.9 State shall convey State Empowered Committee and State Level Task Force
periodical meetings without fail.

9. MINERAL BASED INDUSTRY

9. The State shall make efforts to attract mineral based industry into the state to add
value and increase economic activity.

9.1 Application from new industries for areas notified for prospecting of mining shall
be considered in an equitable manner with the following criteria to the extent specified in
the notification.

• Non-availability of adequate ore linkage.

• Pioneering nature of the industry in a location.
• Induction of High end sophisticated technology.
• Beneficiation or value addition at ore stage.
• Better utilization of run of the mine.

9.2 New mineral based industries shall be encouraged for setting up of units in or near
mineralized areas through appropriate tax and other incentives.
9.3 The State shall enter into equitable arrangements for supply of water, power and
other infrastructure inputs.

9.4 The State shall ensure proper allocation of funds collected through cess on mineral
bearing areas to the development of infrastructure in the mineral bearing areas.

10. THE IMPLEMENTATION OF THE POLICY

Implementation of the policy will be ensured through the twin mechanism of the State
Geological Programming Board and the State Empowered Committee.