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FIMI Supports Present System of Average Sale Price by IBM

Mining News - Published on Wed, 29 Jul 2020

Image Source: FIMI National Mineral Index
Federation of Indian Mineral Industries has urged the Indian government to continue with the present system of average sale price published by Indian Bureau of Mines which it says is the most effective and transparent way to ensure price discovery and revenue to the exchequer. FIMI in a letter to Mines Minister Pralhad Joshi said “We submit that the present system of ASP is a realistic price discovery mechanism, wherein the actual transaction price of top 10 non-captive mines in a state sold at arm’s length basis is captured. In short, ASP is the weighted average of the ex-mine prices of non-captive mines. National Mineral Index is being developed on the lines of the National Coal Index, which is based on Coal India notified prices and auction prices and import prices. While majority of the coal consumed in the country is for power, which is a regulated sector, all non-coal minerals are consumed for non-regulated sectors such as steel, aluminium, cement, etc. Considering this fundamental difference of regulated and non-regulated consuming sectors, the methodology of calculation of NMI should fundamentally differ from that of NCI.”

FIMI added #We also understand that there is a strong attempt by players who have bid unsustainably high auction premiums to include captive sales transactions in NMI. This will help such captive players to report lower than market transactions, which will be captured in NMI, eventually bringing it down and associated statutory payments to the exchequer,' the miners' body said.

This comes in the wake of the government earlier stating that it is in the process of developing nation mineral index for various minerals.

Source :

Posted By : Yogender Pancholi on Wed, 29 Jul 2020
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