Addressing participants of the `Mineral East' meet, organised by the Orissa chapter of the Confederation of Indian Industry recently, T Subbarami Reddy, Union minister of state for mines, said the ministry would provide guidance to these state governments through the Indian Bureau of Mines and the Geological Survey of India.
Though India has about 9 per cent of the total gold reserves in the world, the country imports gold worth more than Rs 65,000 crore (Rs 650 billion) and diamonds worth Rs 75,000 crore (Rs 750 billion) every year.
Keeping this in view, the government has decided to accord top priority to the exploration of gold and diamond in a big way from this year.
Over the next three years, the Union government plans to reduce gold and diamond imports by Rs 20,000 crore (Rs 200 billion).
Reddy added that the ministry was hopeful of stopping all imports for domestic use in 10 years time.
Stating that mining played an important role in the development of the economy, he said only 5 per cent out of the 14.5 lakh square kilometers of mineral reserves have been explored.
Reddy said that this left a huge scope for further mining activities in the country.
The proposed national mineral policy would encourage exploration activities, pointing to the absence of sophisticated technology in gold and diamond exploration.
According to him, the new policy will be instrumental in encouraging foreign technology and investment in the exploration and mining sector.
"Countries like Canada and Australia are booming with mining income, there is no reason why India cannot generate enough mining revenue," he said.
The policy will also help in raising funds for prospective entrepreneurs willing to take up the exploration work.
It will be highly beneficial for states such as Orissa, where the mining revenue is only around Rs 1000 crore (Rs 10 billion). According to Reddy, this could easily go up by another Rs 1000 crore (Rs 10 billion) in a year.
