Rio Tinto Diamonds plans to conduct a $75m pre-feasibility study of its diamond project in the Indian state of Madhya Pradesh.

The feasibility study at the Bunder Diamond project, where Rio discovered eight diamondiferous lamproites, is scheduled to begin in early 2010, reports.

The company has already invested $25m in the country over the past five years, Rio Tinto Diamonds announced as it celebrated 20 years of business in India.

The mine is expected to produce two to three million carats of diamonds annually.

Rio, which sells about 10% of its diamond production in India, is also in talks with other Indian states for diamond exploration, The Australian reports.