Min­ing firms Need dis­rup­tive In­no­va­tion to Catch up: Sur­vey


Resource Digest - - CONTENTS -

The be­lea­guered min­ing in­dus­try is bank­ing on “dis­rup­tive in­no­va­tion“to achieve the govern­ment's vi­sion of self suf­fi­ciency and this bur­den lies on the com­pa­nies, ac­cord­ing to a sur­vey by the Uni­ver­sity of West­ern Aus­tralia and global con­sult­ing firm VCI. En­vi­ron­men­tal pres­sures still weigh on minds of In­dian min­ers more than their global peers but 93 per cent of In­dian min­ing lead­ers be­lieve that in­no­va­tion is crit­i­cal for long-term busi­ness strat­egy and suc­cess against 62 per cent in Aus­tralia and 59 per cent in the USA, the sur­vey said.

Min­ing ac­counts for about 2.5 per cent of In­dia's GDP. The sec­tor has been strug­gling with prob­lems re­lat­ing to en­vi­ron­men­tal and for­est clear­ance ap­provals, opposition from lo­cal com­mu­ni­ties and land ac­qui­si­tion, which has im­peded growth. The NDA govern­ment led by Prime Min­is­ter Naren­dra Modi is now seek­ing to at­tract in­vestors to this sec­tor to scale up do­mes­tic pro­duc­tion.

In­no­va­tion State of Play, a plat­form cre­ated by in­ter­na­tional con­sul­tant VCI and Uni­ver­sity of West­ern Aus­tralia, con­ducted a sur­vey of min­ers across the globe. The In­dia re­port, ti­tled How can In­dia un­leash its po­ten­tial to be­come a world min­ing su­per­power, com­piles views from 50 min­ing lead­ers of In­dia's top nine min­ing firms in­clud­ing the Adani Group, Coal In­dia Ltd, Jin­dal Steel and Power, Tata Steel and Vedanta Re­sources.

“To achieve the govern­ment's vi­sion of self-suf­fi­ciency, it can­not just catch up to the rest. It must dis­rupt the whole in­dus­try,“said the re­port. Quot­ing a CEO anony­mously, it adds, “In­dia has to leapfrog. Fifty years of evolution has to hap­pen in five years. Ev­ery­one in In­dia talks about dis­rup­tion, not in­no­va­tion. It spills off the lips of the PM, the min­is­ters... no one talks about job cre­ation”. In the last two years, the In­dian govern­ment has un­der­taken re­forms and pol­icy changes to make min­ing a more trans­par­ent ac­tiv­ity.

Al­most all pend­ing min­ing and ex­plo­ration con­ces­sions were made open to reap­pli­ca­tion and all un­de­vel­oped blocks were ta ken back by the govern­ment and con­sol­i­dated from pre­vi­ous dis­parate and less eco­nomic blocks. The govern­ment now auc­tions these mines through a more trans­par­ent process and hopes to at­tract in­vestors from both In­dia and abroad. The re­port quotes an­other CEO, “The steps they took were right — to in­ject trans­parency. There were some mis­takes, but they were well in­ten­tioned.”

But many also sug­gest­ing that the govern­ment's ap­proach “has killed nec­es­sary ex­plo­ration in­vest­ment“The govern­ment coun­ters that it has and will “rapidly tweak its process un­til the nec­es­sary in­vest­ment is achieved“. Rapidly re­fin­ing reg­u­la­tions is not some­thing `tra­di­tional min­ers' are com­fort­able with but if it works, it can have far-reach­ing ef­fects.

“This fo­cus on trans­parency has lim­ited the govern­ment's at­ten­tion on in­no­va­tion, as it `fo­cuses all of its cur­rent re­forms on clean­ing up the min­ing in­dus­try be­fore it looks to fa­cil­i­tate fur­ther in­vest­ment in tech­nol­ogy or in­no­va­tion in the in­dus­try'. In this sense, the bur­den of in­no­va­tion has fallen squarely on the shoul­ders of pri­vate com­pa­nies. It ap­pears that these com­pa­nies are ac­cept­ing the re­spon­si­bil­ity with rel­ish,“the re­port said.

Newspapers in English

Newspapers from India

© PressReader. All rights reserved.