A senior official of the Union Mines Ministry today said that solution to the

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menace of illegal mining was not yet in sight, thanks to the swelling demand for minerals in the international market.

A K Srivastava, Additional Secretary, Ministry of Mines, said at a conference here that inadequate regulatory mechanism at the state level had led to the illegal mining.

"Yet the situation does not seem to be looking for an early resolution," he said at the two-day conference on `Mining for Sustainability', organised by Federation of Indian Mineral Industries (FIMI).

He blamed the high demand for minerals that international market has been witnessing for a decade, and the resultant high prices of minerals, for the malaise.

"Bulk mining segment of Indian mining sector has been able to capitalise on this so much that miners are now taking steps towards forward integration by setting up manufacturing industries in mineral-rich states," he said.

The draft Mines and Minerals (Development and Regulation) Bill, 2011 has proposed to set up a mining regulatory authority to advise the governments on levying of charges on mineral extraction and ensure quality standards, he said.

To curb the illegal mining, Srivastava said, the government was setting up a system, wherein the mine owners, stockists, exporters and end-users would be required to register with the Indian Bureau of Mines (IBM).

"They will have to report all the mineral transactions on monthly and annual basis to IBM... This system would facilitate accounting of entire mineral produce from the source to the end-use plant or port," he said.