Mining in India
The Mining industry in India is a major economic activity which contributes significantly to the economy of India. The GDP contribution of the mining industry varies from 2.2% to 2.5% only but going by the GDP of the total industrial sector it contributes around 10% to 11%. Even mining done on small scale contributes 6% to the entire cost of mineral production. Indian mining industry provides job opportunities to around 700,000 individuals.
India is the largest producer of sheet mica, the third largest producer of iron ore and the fifth largest producer of bauxite in the world. India's metal and mining industry was estimated to be $106.4bn (£68.5bn) in 2010.
The tradition of mining in the region is ancient and underwent modernization alongside the rest of the world as India gained independence in 1947. The economic reforms of 1991 and the 1993 National Mining Policy further helped the growth of the mining sector. India's minerals range from both metallic and non-metallic types. The metallic minerals comprise ferrous and non-ferrous minerals, while the nonmetallic minerals comprise mineral fuels, precious stones, among others.
D.R. Khullar holds that mining in India depends on over 3,100 mines, out of which over 550 are fuel mines, over 560 are mines for metals, and over 1970 are mines for extraction of nonmetals. The figure given by S.N. Padhi is: 'about 600 coal mines, 35 oil projects and 6,000 metalliferous mines of different sizes employing over one million persons on a daily average basis.' Both open cast mining and underground mining operations are carried out and drilling/pumping is undertaken for extracting liquid or gaseous fuels. The country produces and works with roughly 100 minerals, which are an important source for earning foreign exchange as well as satisfying domestic needs. India also exports iron ore, titanium, manganese, bauxite, granite, and imports cobalt, mercury, graphite etc.
Unless controlled by other departments of the Government of India mineral resources of the country are surveyed by the Indian Ministry of Mines, which also regulates the manner in which these resources are used. The ministry oversees the various aspects of industrial mining in the country. Both the Geological Survey of India and the Indian Bureau of Mines are also controlled by the ministry. Natural gas, petroleum and atomic minerals are exempt from the various activities of the Indian Ministry of Mines.
Flint was known and exploited by the inhabitants of the Indus Valley Civilization by the 3rd millennium BCE. P. Biagi and M. Cremaschi of Milan University discovered a number of Harappan quarries in archaeological excavations dating between 1985-1986. Biagi (2008) describes the quarries: 'From the surface the quarries consisted of almost circular empty areas, representing the quarry–pits, filled with aeolian sand, blown from the Thar Desert dunes, and heaps of limestone block, deriving from the prehistoric mining activity. All around these structures flint workshops were noticed, represented by scatters of flint flakes and blades among which were typical Harappan-elongated blade cores and characteristic bullet cores with very narrow bladelet detachments.' Between 1995 and 1998, Accelerator mass spectrometry radiocarbon dating dating of Zyzyphus cf. nummularia charcoal found in the quarries has yielded evidence that the activity continued into 1870-1800 BCE.
Minerals subsequently found mention in Indian literature. George Robert Rapp—on the subject of minerals mentioned in India's literature—holds that:
Sanskrit texts mention the use of bitumen, rock salt, yellow orpiment, chalk, alum, bismuth, calamine, realgar, stibnite, saltpeter, cinnabar, arsenic, sulphur, yellow and red ochre, black sand, and red clay in prescriptions. Among the metals used were gold, silver, copper, mercury, iron, iron ores, pyrite, tin, and brass. Mercury appeared to have been the most frequently used, and is called by several names in the texts. No source for mercury or its ores has been located. Leading to the suggestion that it may have been imported.
The distribution of minerals in the country is uneven and mineral density varies from region to region. D.R. Khullar identifies five mineral 'belts' in the country: The North Eastern Peninsular Belt, Central Belt, Southern Belt, South Western Belt, and the North Western Belt. The details of the various geographical 'belts' are given in the table below:
|Mineral Belt||Location||Minerals found|
|North Eastern Peninsular Belt||Chota Nagpur plateau and the Orissa plateau covering the states of Jharkhand, West Bengal and Orissa.||Coal, iron ore, manganese, mica, bauxite, copper, kyanite, chromite, beryl, apatite etc. Khullar calls this region the mineral heartland of India and further cites studies to state that: 'this region possesses India's 100 percent Kyanite, 93 percent iron ore, 84 percent coal, 70 percent chromite, 70 percent mica, 50 percent fire clay, 45 percent asbestos, 45 percent china clay, 20 percent limestone and 10 percent manganese.'|
|Central Belt||Chattisgarh, Andhra Pradesh, Madhya Pradesh and Maharastra.||Manganese, bauxite, uranium, limestone, marble, coal, gems, mica, graphite etc. exist in large quantities and the net extent of the minerals of the region is yet to be assessed. This is the second largest belt of minerals in the country.|
|Southern Belt||Karnataka plateau and Tamil Nadu.||Ferrous minerals and bauxite. Low diversity.|
|South Western Belt||Karnataka and Goa.||Iron ore, garnet and clay.|
|North Western Belt||Rajasthan and Gujarat along the Aravali Range.||Non-ferrous minerals, uranium, mica, beryllium, aquamarine, petroleum, gypsum and emerald.|
Agencies involved in exploration
In India, systematic surveying, prospecting and exploration for minerals is undertaken by the Geological Survey of India (GSI), Oil and Natural Gas Corporation (ONGC), Mineral Exploration Corporation Limited (MECL), National Mineral Development Corporation (NMDC), Indian Bureau of Mines (IBM), Bharat Gold Mines Limited (BGML), Hindustan Copper Limited (HCL), National Aluminium Company Limited (NALCO) and the Departments of Mining and Geology in various states.
Along with 48.83% arable land, India has significant sources of coal (fourth-largest reserves in the world), bauxite, titanium ore, chromite, natural gas, diamonds, petroleum, and limestone. According to the 2008 Ministry of Mines estimates: 'India has stepped up its production to reach the second rank among the chromite producers of the world. Besides, India ranks 3rd in production of coal & lignite, 2nd in barites, 4th in iron ore, 5th in bauxite and crude steel, 7th in manganese ore and 8th in aluminium.'
India accounts for 12% of the world's known and economically available thorium. It is the world's largest producer and exporter of mica, accounting for almost 60 percent of the net mica production in the world, which it exports to the United Kingdom, Japan, United States of America etc. As one of the largest producers and exporters of iron ore in the world, its majority exports go to Japan, Korea, Europe and the Middle East. Japan accounts for nearly 3/4 of India's total iron ore exports. It also has one of the largest deposits of manganese in the world, and is a leading producer as well as exporter of manganese ore, which it exports to Japan, Europe (Sweden, Belgium, Norway, among other countries), and to a lesser extent, the United States of America.
The net production of selected minerals in 2005-06 as per the Production of Selected Minerals Ministry of Mines, Government of India is given in the table below:
|Natural Gas||31,007||Million cubic metres||Fuel|
|Crude Petroleum||32||Million tonnes||Fuel|
|Bauxite||11,278||Thousand tonnes||Metallic Mineral|
|Copper||125||Thousand tonnes||Metallic Mineral|
|Gold||3,048||Thousand grammes||Metallic Mineral|
|Iron Ore||140,131||Thousand tonnes||Metallic Mineral|
|Lead||93||Thousand tonnes||Metallic Mineral|
|Manganese Ore||1,963||Thousand tonnes||Metallic Mineral|
|Zinc||862||Thousand tonnes||Metallic Mineral|
|Diamond||60,155||Carats||Non Metallic Mineral|
|Gypsum||3,651||Thousand tonnes||Non Metallic Mineral|
|Limestone||170||Million tonnes||Non Metallic Mineral|
|Phosphorite||1,383||Thousand tonnes||Non Metallic Mineral|
The net exports selected of minerals in 2004-05 as per the Exports of Ores and Minerals Ministry of Mines, Government of India is given in the table below:
|Mineral||Quantity exported in 2004-05||Unit|
|Gypsum & plaster||103,003||tonnes|
Legal and Constitutional framework
With respect to International Initiatives, India is not a signatory to the Extractive Industries Transparency Initiative [EITI], a globally developed standard for extraction of natural resources to promote revenue transparency at the local level. But, on national scale, there are legal and constitutional framework to manage mineral sector
- The policy level guidelines for mineral sector is given by National Mineral Policy, 2008.
- The mining operations are regulated in terms of Mines and Minerals(Development and Regulation) [MMDR] Act 1957 enacted by the Parliament.
- The State Governments, as owners of minerals, grant mineral concessions and collect royalty, dead rent and fees as per the provisions of MMDR Act 1957. In a recent development, the Supreme Court has said that "Ownership of minerals should be vested with the owner of the land and not with the government."
- The royalty and dead rent revenues collected by the State Government accrue to the Consolidated Fund of State Government concerned and are then appropriated for public spending through a budgetary process which has to be approved by the Legislative House of the State Government concerned.
Profit Sharing Formula
The Mines and Minerals (Development and Regulation) Act, 1957 does not provide for any profit sharing formula between Government and local people. But the draft Minerals (Development and Regulation) Bill (MMDR bill), 2011 provides for the following
- Suitable compensation for all exploration activities to be payable to the person or family holding occupation or usufruct or traditional rights on the area of exploration,
- All Mining Lease holders, including public sector undertakings and private sector companies to pay annually into a District Mineral Foundation set up at District level
- A sum equivalent to royalty in case of major minerals (other than coal)
- A sum equivalent to 26% of profit in case of coal minerals;
- And in case of minor minerals a sum prescribed by the State Government.
- A portion of the amount paid into the District Mineral Foundation shall be used to make recurring payments to people affected by mining related operations.
- All mining companies to allot at least one share at par to each person of the family affected by mining, so as to give a sense of ownership in the enterprise.
- All mining companies to provide employment or other compensation as stipulated under Rehabilitation and Resettlement policy
Issues with Minings
One of the most challenging issues in India's mining sector is the lack of assessment of India's natural resources. A number of areas remain unexplored and the mineral resources in these areas are yet to be assessed. The distribution of minerals in the areas known is uneven and varies drastically from one region to another. India is also looking to follow the example set by England, Japan and Italy to recycle and use scrap iron for ferrous industry.
Under the British Raj a committee of experts formed in 1894 formulated regulations for mining safety and ensured regulated mining in India. The committee also passed the 1st Mines act of 1901 which led to a substantial drop in mining related accidents. The accidents in mining are caused both by man-made and natural phenomenon, for example explosions and flooding. The main causes for incidents resulting in serious injury or death are roof fall, methane gas explosion, coal dust explosion, carbon monoxide poisoning, vehicular accidents, falling/slipping and hauling related incidents.
In recent decades, mining industry has been facing issues of large scale displacements, resistance of locals - as reported by the Indian journalist Aditi Roy Ghatak in the magazine D+C Development and Cooperation -, environmental issues like pollution, corruption, deforestation, dangers to animal habitats.
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