HARARE – Zimbabwe has partnered India to form a mining joint venture.
The venture — planning to develop four mining reserves in Zimbabwe — targets chrome, gold, iron and diamonds.
Last week, India’s State-owned NMDC Limited (NMDC) signed a memorandum of understanding (MoU) with Mosi oa tunya Development Company (MtDC) — a special purpose vehicle under the administrative control of Walter Mzembi’s Tourism ministry.
Chandra Shekar Verma, NMDC managing director and chairperson, said the move to invest in the southern African country is part of his company’s strategy to shore up mineral reserves globally.
“The signing of this MoU is a significant step towards ensuring augmentation of NMDC’s mineral reserves and globalisation of its operations,” he said.
Verma said NMDC was planning to develop mineral assets abroad with a view to getting raw materials for India’s steel industry.
He said the MoU would offer NMDC “exclusivity” to participate in mineral projects in Zimbabwe.
India has proposed 50-50 shareholding in the joint venture.
Mzembi, however, could not be reached for comment yesterday as his mobile went unanswered.
MtDC will develop the reserves though sources said NMDC would require around 60 days to carry out a due diligence to ascertain the exact quantity of resources as well as the financial worth of the deposits.
This comes as Zimbabwe expressed interest in working with the Asian country during India’s Steel minister Beni Prasad Verma’s visit in April this year.
During the visit, Verma was offered mining leases to develop the four reserves.
The visit by a Zimbabwean delegation to sign the MoU in India last week — led by Tourism ministry permanent secretary Margaret Sangarwe — was a follow up to discussions held in April by the two nations.
According to Zimbabwe’s mineral policy, activities like development and exploitation of mineral deposits is done only at a government-to-government level and all mining leases are owned by the State — unlike in countries like Brazil where leases are held by private companies.
NMDC’s quest to expand its global resource base is indicated by its acquisition of Australia Legacy iron ore reserves in 2011.
It has also signed a MoU with Brazil’s Amplus Mineracao to invest in the firm’s iron ore mines.
The Indian firm is also exploring opportunities to acquire coal companies.
NMDC is under the ambit of India’s Steel ministry.
It is involved in the exploration of wide range of minerals including iron ore, copper, rock phosphate, lime stone, dolomite, gypsum, bentonite, magnesite, diamond, tin, tungsten, graphite and beach sands.
NMDC is India’s single largest iron ore producer, presently producing about 30 million tonnes of iron ore from three fully mechanised mines. – John Kachembere