An analysis of non-fuel mineral blocks auctions in India - Ganesh Sivamani

The value of the mineral despatched is the product of the quantity mineral despatched in a month (the minerals sent off from the mines) and the sale price of the mineral (grade-wise and state-wise) published by the Indian Bureau of Mines (IBM) for the month of despatch. [...] The eventual holder of the lease shall pay to the state government, every month, the product of the value of the mineral despatched and their winning percentage bid. [...] The ex-mine price is the sale price of the mineral at the mine head, and the weightage is done on the quantity of minerals despatched. [...] The value of estimated resources for a given mineral block is defined in the Mineral (Auction) Rules as the product of estimated quantity of mineral resources (expressed in metric tonne) and the average price per metric tonne of resources published by the IBM for the relevant state over the twelve months immediately preceding the computation. [...] The average winning bid (not the arithmetic mean of the 70 winning bid percentages, but the ratio of total contribution from auctions to the value of resources) comes to 62.4%, and 17.6% of the value of the resource, on average, will need to be paid as statutory payments.