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India's mineral resources cover a wide spectrum essential for a modern economy. According to the Geological Survey of India, 50 important minerals occur within India. Of the total land area of 3.28 million sq. km, 2.42 million sq. km is hard rock terrain suitable for mineral exploitation.
Minerals are divided into four groups based on India's capacity for self-sufficiency and export:
i)Export-dominant minerals where India can dominate global trade, e.g., iron-ore and mica.
ii)Export-surplus minerals that contribute significantly to trade, including manganese ore, bauxite, and gypsum.
iii)Self-sufficient minerals such as coal, sodium salts, glass sand, and phosphates.
iv)Import-dependent minerals like copper, nickel, petroleum, lead, zinc, tin, mercury, platinum, and graphite.
Fuel minerals: coal, lignite, natural gas, and petroleum.
Metallic minerals: bauxite, iron-ore, manganese, etc.
Non-metallic minerals: phosphorite, graphite, gypsum, limestone, mica, etc.
The following table shows the growth in mineral production over the decades:
1951: Rs. 83.3 crore
1961: Rs. 81.2 crore
1971: Rs. 502.9 crore
1980: Rs. 2,310 crore
1990: Rs. 16,456 crore
2000-01: Rs. 46,700 crore
2005-06: Rs. 72,760 crore
2009-10: Rs. 94,597 crore
Fuel minerals account for approximately 85% of total production value. Coal and petroleum dominate this segment, with coal alone contributing over 55% of total fuel mineral value. Metallic and non-metallic minerals each contribute about 6–7% of total value.
Minerals serve as the foundation for rapid industrialisation. They unlock avenues for faster growth in various industries due to India’s favorable geological setting, which is comparable to that of South Africa and Australia. According to a recent Price Waterhouse Report, India is identified as the most promising mining destination globally.
Despite this, India’s exploration spending is only 0.8% of global levels, with the private sector contributing merely 3% of that. These figures highlight the urgent need for a strategic and inclusive mineral policy.
The Great Plains of Northern India are largely devoid of economically viable mineral deposits.
Jharkhand and Odisha (in the north-eastern peninsular region) hold nearly 75% of India’s coal deposits, along with rich reserves of iron-ore, manganese, mica, bauxite, and radioactive minerals.
Other deposits are scattered across peninsular India, Assam, and Rajasthan.
The implementation of UN laws on Exclusive Economic Zones (EEZs) opens up deep-sea exploration for oil, gas, manganese, and polymetallic nodules like nickel, cobalt, and copper.
Crude oil and petroleum are critically deficient in India. A large share of current demand is met through imports. Rising international prices make it imperative to both curb excessive use and intensify domestic exploration.
Certain minerals offer lucrative export potential. A well-designed policy must ensure their optimal utilisation in national interest, balancing resource use with revenue generation.
Due to limited financial resources, much of India’s mining sector remains trapped in obsolete technologies that have not seen major upgrades for decades.
The National Mineral Policy was initially announced on August 9, 1990, modified on March 5, 1993, and further revised on October 17, 1996. The major objectives of the policy are:
To strike a balance between conservation and development.
To promote necessary linkages for smooth and uninterrupted development of the mineral industry to meet the needs of the country.
To minimise the adverse effects of mineral development on forests, environment, and ecology through appropriate protective measures, and ensure mining operations prioritize safety and health.
To consider national and strategic concerns in planning mineral resource development, ensuring adequate supply and optimal use for present and future needs.
To establish educational and training facilities for human resource development to meet the manpower needs of the mineral industry.
i)The Government has opened the entire mining industry to private sector participation, except for uranium and mineral oil.
ii)The Mines and Minerals Regulation and Development Act was amended to allow private capital, both domestic and foreign.
iii)The ceiling on foreign equity participation was raised to 74% in Indian mining companies.
iv)The policy permits mineral and metal processing units to develop captive mines to secure assured raw material supplies, promoting foreign equity as permitted.
v)Strip mining in forest areas is prohibited unless companies undertake time-bound reclamation programs.
vi)No mining lease shall be granted without a proper mining plan, including an environmental management plan approved and enforced by statutory authorities.
vii)Exploitation of sea-bed mining in the Indian Ocean is not permitted.
The Government must carefully proceed with privatisation of mineral exploitation and exports to avoid short-sighted private greed harming long-term national interests. A pragmatic approach is essential, avoiding extremes that have led to disaster in countries like Nigeria, Zaire, Persian Gulf countries, and Nauru.
A committee was set up in late 2005 under the chairmanship of Anwar-ul Hoda. The New Mineral Policy, 2008 incorporates most recommendations from the Hoda Committee Report.
i)The policy recognises the private sector as the main source of investment in reconnaissance and exploration. It ensures security of tenure and rights of transferability of awards such as reconnaissance permits (RPs), prospecting licences (PLs), and mining leases (MLs).
ii)Introduction of Long Area Prospecting Licences (LAPLs) for non-bulk minerals, enabling investors to achieve economies of scale in high-risk, high-reward areas.
iii)Mining is treated as a standalone industrial activity that can thrive alongside value-addition activities.
iv)Export policies will be formulated based on mineral inventories and short-, medium-, and long-term needs. Emphasis is placed on exporting minerals in value-added forms whenever possible.
v)The policy aims to facilitate financing of mine development and exploration, integral parts of mining projects.
vi)Plans to develop suitable capital market structures to attract risk investment, easing flow of ‘risk funds’ from capital markets and venture funds through policy interventions.
vii)Public-private partnership (PPP) models are promoted for building mining infrastructure.
viii)The policy seeks to establish a uniform mineral administration system across the country.
India is rich in a variety of natural resources but faces a gap between supply and demand as well as under-utilisation due to technological and policy constraints. Immediate requirements include:
i)Intensive surveys to explore and identify unknown utilisable resources, both renewable and non-renewable, supported by an integrated multi-pronged national policy.
ii)Efficient use of available resources by adopting better technology, utilisation of by-products, multipurpose use, and strategic industry locations to minimise transport costs.
iii)Conservation measures that ensure sustainable output, reviving traditional institutions and community consciousness to manage the divergence between individual and social rates of discount.
iv)The need for an effective organisational set-up. Privatisation alone cannot be the goal; care must be taken to prevent undue losses to the public exchequer from ill-conceived transfers of publicly owned resources.
In the interest of swift economic development, the above considerations about resource utilisation, conservation, and organisational efficiency cannot be ignored.
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