More than a decade after its discovery, Rio Tinto Group said Monday it will shut the Bunder diamond mine in India by the end of the year, as the world’s second-biggest miner seeks to cut costs and conserve cash.
Bunder remains a top-class diamond deposit and Rio Tinto will work with the federal and Madhya Pradesh state governments to examine options for another investor to take over the project, the company said in an e-mailed statement.
Development of the mine about 500 kilometers (310 miles) southeast of New Delhi has been stymied by delays in environmental approvals that would allow the clearing of a forested area important to tiger and other wildlife habitats. The deposit was discovered in 2004.
Rio Tinto joins other foreign investors such as South Korea’s biggest steelmaker Posco who have put Indian plans on hold because of drawn-out approval processes, government red tape and land acquisition hurdles. India is seeking to overhaul exploration and mining rules by cutting the time needed for environmental and state approvals and thereby boost investments.
The Rio project had been in the works for some years and it was time for them to take this move “because these companies need a single window clearance or at least something that works for them,” Gunjan Aggarwal, an analyst at consultancy CRU Group, said by phone from Mumbai.
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