MODI’S JUMBO MINING PUSH TO NET `4L CR
THE GOVERNMENT IS LOOKING AT MASSIVE INVESTMENTS, NEW INDUSTRIES, MANUFACTURING JOBS AND EXPORT BOOST
India’s mining sector is all set to get the Modi push. Aiming to increase mineral production by Rs 4 lakh crore in five years, the mines ministry will press special aircrafts into service in six months to undertake an ambitious four-year aerial geophysical survey over 8 lakh sq km, which is one fourth of the country.
And that’s not all. A new exploration watchdog has been set up. A new exploration policy will also be out in two months. Auctioning of identified blocks has been put on the fast-track as well.
Through this push the government is looking at massive investments, new industries, and manufacturing jobs. This will also check costly imports of minerals and enhance exports of value-added products.
For aerial exploration, the government will not rely on its centuries-old exploration ally - the Geological Survey of India (GSI) - but take the global tender route.
The mines ministry, which surveys and explores all major minerals (excluding coal, natural gas and petroleum), on Wednesday wrote to the Prime Minister’s Office (PMO) about its plans for aerial geophysical surveys. The ministry has started the process of hiring consultants to help find an agency for these surveys.
Indian firms can also apply, but the task at hand suggests those in Australia, Canada, the UK, the US and South Africa could be in the running, said ministry sources.
“These high-resolution surveys of deposits will exponentially enhance India’s prowess and achieve global standards in exploring minerals, brining in massive investments into the largely underexploited mining sector,” union mines secretary Balvinder Kumar said.
The mines ministry last month set up a National Mineral Exploration Trust to look into ways to encourage exploration. The draft of a National Mineral Exploration Policy is also ready.
“We intend to seek the approval of the union cabinet in two months,” the ministry’s letter to the PMO says.
The policy will encourage the participation of the private sector in mineral exploration. The value of mineral production in
India has come down from Rs 2,85,761 crore (about 2.4% of the GDP) in 2012-13 to Rs 2.27,000 crore in 2014-14.
“The aim is increase contribution of mining to GDP to 6 per cent. That’s roughly an increase of Rs 4 lakh crore,” said another official of the ministry.
The ministry has admitted that near-surface blocks in India are fast depleting. There is also a decline in the rate of identification of such ore deposits. The government is looking for modern ways to explore new areas for both near-surface and deep seated deposits.
“The GSI surveys 50-60,000 sq km in a year. They will take about 15 years at this rate. And they have only one aircraft. That’s why we’re taking the global tender route. The firm we will eventually hire will use 6 special aircrafts and do two 8-hour sorties a day,” said another ministry official.
These surveys will be done in Karnataka, Tamil Nadu, Andhra Pradesh, Telangana, Odisha, Jharkhand, Madhya Pradesh, Rajasthan and fringe areas of Maharashtra and Gujarat. This will cost around Rs 1,500 crore.
The overall geophysical survey that the ministry is looking at will require Rs 4,000 crore.
The ministry is the apex body for legislation, administration, and policy formulation for mining and metallurgy of metals like aluminum, copper, zinc, lead, gold and nickel.
States auction mining blocks and get royalty from companies. States also control minor minerals such as sand, sandstone and granite.
Finding new blocks is the not the only challenge here. States are struggling to auction the 80-90 identified ones.
The ministry has written to the PMO that most states lack manpower and technical expertise to carry out auctioning in near future. The ministry has decided to go for “handholding” by drafting its own PSUs to start the first phase of auctioning from November.
“During the last decade, India has witnessed a growth rate of above 6%. If we want to get to 9-10%, the mining sector has to play a very important role,” said a mining ministry official.
There are serious concerns, too. Most of India’s mineral deposits are in Naxal-affected, tribal and backward areas. The local population and the dense forest cover are often a victim of mining.
“We notified a scheme that will essentially extract about Rs 6,000 crore every year from mining for the welfare of locals,” said Kumar.
PRIME MINISTER NARENDRA MODI