Govt to hold first-ever auction for diamond mine soon

The government plans to hold its first-ever auction for a diamond mine in a little over a month, the country's top mines official said on Friday, as part of efforts to boost local output of minerals and cut expensive imports.

Madhya Pradesh (MP) will soon float tenders for the auction of the Hatupur block which is likely to be completed in about forty days, mines secretary Balvinder Kumar said.

The block, spread over 136 hectares, has 604,336 tonne of mineral resources.

The government began auctioning mines such as coal, iron ore and bauxite after a raft of legal battles over illegal allocation of resources.

Mining firm Rio Tinto has evinced interest in mining diamonds from another mine in MP but environmental hurdles have hobbled the project, local media reports said.

Vedanta won first-ever auction of a gold mine in February as the nation opened up the sector to private companies to curb overseas purchases of the metal that cost it $36 billion last year.