India is all set to ink a pact with Zimbabwe Government later this month for developing four reserves in that country having gold, diamond, iron ore, coal and chrome ore deposits. The development assumes significance as the African nation’s position of being one of major gold exporters in the world has significantly slid owing to domestic unrest in recent time and therefore it is keen to partner with India for developing its rich treasure trove of minerals.
According to sources privy to the information, a Government-level delegation from Zimbabwe is scheduled to arrive in a couple of weeks’ to New Delhi and a MoU is to be signed with the Steel Ministry for developing the four reserves. Post the signing of the agreement, the Government has proposed formation of a joint venture (JV) company where the state-owned mining major NMDC and the Zimbabwe Government would be having 50-50 partnership.
This JV company would jointly develop the reserves, though prior to this, sources said that NMDC would require around 60 days to complete the due diligence of the reserves to ascertain the exact quantity of resources as well as the financial worth of the deposits.
Official sources told The Pioneer that once the MoU is signed in two weeks’ time, the due diligence process would immediately begin. On completion of due diligence, the JV company is expected to formed in the following three months time (after due diligence period is over). So by end of this year, the process of developing the reserves is expected to begin, sources informed.
Till the time the due diligence process would continue, NMDC has sought exclusivity for all the deposits. Though it is not clear whether a minister from Zimbabwe would be heading the Government-level delegation to New Delhi, Steel Ministry sources said that the MoU signing is very much on cards.
During Steel Minister Beni Prasad Verma’s visit to Zimbabwe in April this year, the African nation had evinced a keen interest in seeking India’s cooperation in development of its gold, diamond, iron ore and chrome ore reserves.
Also after discussions between Verma and various Zimbabwean ministers (including those of mines, industry and tourism departments), that country had offered mining leases to India for developing the four reserves.
The visit by the Zimbabwean delegation later this month is a result of the discussions held in April between the two nations. Sources further informed that owing to domestic instability and various other reasons, Zimbabwe’s position as one of the major exporters of gold and diamond from within the African continent has been greatly undermined in the last 10 years, therefore it is eager to seek India’s help in reviving its stature as a producer of major natural resources.
India’s expertise and experience in mining reserves across the world through entities like NMDC was a major reason behind the pact, sources added. Earlier during his visit to Zimbabwe in April, Verma had shown interest in partnering with the African nation for developing and utilising the low grade iron ore reserves there.
According to Zimbabwe’s mineral policy, activities like development and exploitation of mineral deposits is to be done only on a Government to Government level basis and all mining leases there are owned by the state, unlike in countries like Brazil where leases are held by private companies.