[Solved]Despite India being one of the countries of the Gondwanaland, its mining industry contributes much less to its Gross Domestic Product(GDP) in percentage. Discuss

India was part of Gondwanaland, southern half of the supercontinent Pangea. Rocks of the central Indian region like parts of Madhya Pradesh, Odisha, etc are known as Gondwana rocks.

  • benefits of being country of Gondwana land; 1. High coal reserves for energy centric industries
  • Example: Coal reserves in India are found in Bokaro, Singareni and Korba region
  • Gondwana rocks.
  • 2. High Non-ferrous minerals for industries of electrical appliances
  • Example: Non-ferrous minerals like Bauxite and Copper are heavily found in the Gondwana region
  • 3. Presence of High Ferrous minerals for iron ore industries
  • Examples: Ferrous minerals like iron and manganite is also found in the Gondwana land
  • 4. Presence of nuclear mineral Uranium
  • Example: Uranium only mine in India is found in Jharkhand the Gondwana region
  • 5. Presence of non-metallic minerals like Mica
    • Example: Mica which is used in electrical appliances is produced in Jharkhand a Gondwana land
  • contribution of mining industry to GDP
  • Indian mining sector contributed around 2% of GDP which is continuously declining sues associated with it: 1. Governance failure
  • Poor Environment Impact Assessment Coverage of minimum 5 hectare under ELA has led to cumulating of several small mining areas to unchecked mining losing the economy of scale and efficiency
  • Conflict of interest in EIA: proponents himself gets the ELA done leading to high conflict of interest. It leads to protest and delay in the mining project

• Multiple jurisdiction multiplicity of institutions, state government and central government enhances the red tapism and lead to delay in project.

Poor participation of private players Private players mainly the big one doesn’t participate in mining as there is complexity in rules and regulations Example India has separate rules for the license of exploration and license of production thus

keeping serious interest out High litigation Complexity in the rules have made high litigation in mining industry putting explorable mines into stuck Example. Around 500 mines are stuck into litigation between the industry and state or central government

Discrimination based on usage: discrimination in terms of captive and non-captive mines have caused poor utilization the existing mines and suboptimal extraction of minerals. 2. Industry Specific Issues: • Obsolete technology. Public enterprises use old method to extract which results into inefficiency

Example: Coal industry in India still uses the open pit mining causing huge pollution.

• Not linked to newer industries: Most mines are linked to older industries like thermal, iron ore but newer industries like Solar, Batteries, semiconductors don’t have any mining productions. o Example: 97% of rare earth metal which is key for solar, battery industry is controlled by China.

Poor value addition: Indian mining industry undertakes poor value addition and doesn’t produce high quality material demanded today like carbon Fibre, high quality steel.

3. Social Issues

Displacement of locals: Mining industry leads to heavy displacement of locals which causes

disliking for these industries.

• Example: POSCO steel plant in Odisha was heavily opposed by locals as it could disintegrate their local culture Issues of naxalism.  Presence of naxalism in the key mining area also prevents participation from the mining industry

o Example: Naxal issue in Dantewada Lack of social impact assessment: Lack of SIA keep the locals out of the benefits accruing from

4. Environmental Issues:

Polluting in nature Mining industry causes heavy water, air and land pollution leading protest by the locals

Example Starlite copper plants were closed down due to pollution of ground water Issues of climate change Many mines are located in dense forest and can’t be explored as it would cause felling of trees and lead to climate change

Example: Mines in Chhattisgarh and Jharkhand are not being explored due to being situated in dense area

Simplifying rules and procedures, doing away with captive and non-captive mines, seeking higher foreign investment, timely giving forest and environment clearance along with people participation in mining industry through skill development can enhance contention of mining industry in economy.

Additional  points :

Currently, the mining sector contributes between 2.3% and 2.5% of the country’s gross domestic product. Mineral production in India increased at a compound annual growth rate (CAGR) of 5.72 percent between 2013-14 and 2017-18, and the country produced 101,4 million tonnes of crude steel in 2017. India is the third largest steel producer in the world.

Problems in the mining industry:

  • The mining industry faces issues such as depleted output, squeezed margins, high taxation, a lack of environmental clearances, and inadequate investment in new exploration. In addition to these issues, the sector is also confronted with others, such as delays in mine operations.
  • Loss of Public Revenue: As a result of lobbying, political contributions, and corruption, minerals are frequently sold at prices far below their true value. Illegal mining has a similar impact, but it also results in a loss of public revenue. According to the International Monetary Fund, many governments of resource-rich nations face declining public sector net worth due to unsustainable mining.
  • Numerous Small Mines: In India, the majority of states operate numerous small mines. These present difficult challenges for sustainable development, as their financial, technical, and managerial constraints limit their capacity to take adequate corrective measures.
  • Growing Inequality & Loss of Natural Resources: Naturally, extractors are eager to extract as quickly as possible and move on, which exacerbates inequalities as a few extractors amass wealth without redistributing it to the people. It also results in the destruction of natural resources. For instance, based on Vedanta’s annual reports, it is estimated that between 2004 and 2012, the State of Goa lost more than 95% of the value of its minerals.

It is necessary to expand the scope of exploration through increased reconnaissance and prospecting, which necessitates an injection of funds. For the survival and success of not only this industry, but also the economy as a whole, it is crucial that the Indian mining industry maintains its competitiveness and expands.

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