Ministry of Mines is responsible for the overall development and administration of laws and regulations regarding excavating minerals (natural gases, petroleum and atomic minerals) and non-ferrous metals. It also oversees the Mines and Minerals (Regulation and Development) Act, 1957, which covers all mines and minerals; however, the ministry’s oversight does not cover coal, natural gas and petroleum.
India produces 87 minerals - four fuel, 10 metallic, 47 non-metallic, three atomic and 23 minor minerals (including building and other materials).
India’s mining history dates back to 3rd millennium BCE when flint was used. Lead and zinc mining in Rajasthan began in 1260 BC. By the 4th century BCE, there was a detailed account of metal and mineral properties and their large-scale production along with manufacturing brass, bronze, gold and silver alloys in “Arthasastra.” This treatise is believed to be written by Chanakya, a professor of economics and political science at the ancient Takshashila University. However, there is debate over authorship date, either 4th century BCE or 2nd century AD.
Between 1400-1800, individual kingdoms had their own rules for mining until the Mughals established more strict regulatory controls. Mysore, an Indian Princely state until independence, had its own safety regulations.
In 1851, the Geological Survey of India (GSI) was formed. Secretary of State Lord Cross proposed inspection and regulation of mining operations in 1890. The first Inspector of Mines, James Grundy, worked the GSI to inspect mines and make regulation recommendations. The Mines Act of 1901 covered all minerals (up to 6 meters deep) and provided for inspectors, managers, greater powers for the chief inspector and prohibited the employment of children.
In 1948, the Indian Bureau of Mines (IBM) was established as the main agency to monitor and supervise mining activities.
The Mines and Minerals (Development & Regulation) Act, 1957, confirmed regulation of mines and development of minerals under Union control; however, the ministry’s oversight did not cover coal, natural gas and petroleum.
India’s economy liberalized in 1991, and in March 1993, the National Mineral Policy was created to encourage private investment.
The Mines and Minerals (Development and Regulation) Bill, 2011, was prepared by the ministry to replace the existing Mines and Minerals (Development and Regulation) Act, 1957. The bill would reform the mining industry by addressing sustainability issues, transparency, good mining practices, local area development and introduce profit-sharing to people affected by mining operations. Although approved by the Cabinet in September 2011, it was still being debated in 2012.
Ministry of Mines manages the overall surveying and exploration of all minerals and metals except natural gases, petroleum and atomic minerals. It creates legislation regulating mines and the development of minerals. Mines and minerals include those under the ocean within the territorial waters, the continental shelf, special economic zones and other Indian maritime areas.
The ministry oversees metallurgy of non-ferrous metals such as aluminum, copper, zinc, lead, gold and nickel. It also handles gems such as diamonds and emeralds.
The ministry also administers the Mines and Minerals (Regulation and Development) Act, 1957, which covers all mines and minerals except coal, natural gas and petroleum.
Attached or Subordinate Bodies
The Geological Survey of India (GSI) is an attached office to the ministry. It provides basic earth science information and is an active participant in international geoscientific discussions.
The Indian Bureau of Mines is a subordinate office of the ministry. It promotes conservation and development of mineral resources and encourages environmental protection in mines, with the exception of coal, petroleum, natural gas, atomic minerals and minor minerals.
Public Sector Undertakings (Enterprises)
National Aluminium Company Limited (NALCO)
Incorporated as a public sector enterprise of the ministry in 1981, NALCO is Asia’s largest and the world’s sixth largest aluminum complex. Headquartered in Bhubaneswar, Orissa, it operates bauxite mining, alumina refining, aluminum smelting and casting, power generation and has rail and port operations. NALCO is one of India’s most profitable public sector firms.
Hindustan Copper Limited (HCL)
Hindustan Copper Limited (HCL) was incorporated on November 9, 1967. It is India's only vertically integrated copper producing company consisting of mining, beneficiation, smelting, refining and casting of refined copper metal. It also produces gold, silver, nickel sulphate, selenium, tellurium and fertilizer as by-products. It has plants and Jharkhand, Madhya Pradesh, Rajasthan and Maharashtra.
Mineral Exploration Corporation Limited (MECL)
Established on October 21, 1972, Mineral Exploration Corporation Limited (MECL) conducts exploration for minerals. Services include reconnaissance, mapping, sampling, drilling/mining and environmental studies and are done as Promotional (on behalf of the government of India) or contractual (on behalf of public sector, private sector and state government agencies).
Autonomous Bodies
National Institute of Rock Mechanics (NIRM)
Formed in 1988, the National Institute of Rock Mechanics (NIRM) is a research center for applied and basic rock mechanics. It provides research and consultancy services to the mining and civil engineering industries in order to improve safety and productivity. NIRM handles scientific design of mine workings, design of rock excavations and support systems, site characterization practices and conducts advanced research in rock mechanics and ground control.
National Institute of Miners’ Health (NIMH)
National Institute of Miners’ Health (NIMH)’s overall objective is to ensure the health safety of miners through prevention of occupational diseases. It conducts medical examinations, personal/environmental/machinery assessments for noise, dust, vibrations and presence of toxins and safety research. The NIMH also assists enforcement agencies and the mining industry to comply with national and international standards. It formed on May 11, 1989, and formally became an “autonomous body” on February 21, 1990.
Jawaharlal Nehru Aluminium Research Development and Design Centre (JNARDDC)
Located in Nagpur, Maharashtra, the Jawaharlal Nehru Aluminium Research Development and Design Centre (JNARDDC) studies bauxite, alumina and aluminum and offers the following services: research and development, testing and training. Secondarily, the JNARDDC offers analytical and testing facilities to other non-ferrous industries, steel industries and small-scale industries.
Registered Societies
These institutions are administered by the ministry but do not receive funding directly from the government.
Non-ferrous Materials Technology Development Centre, Hyderabad (NFTDC)
Nonferrous Materials Technology Development Centre (NFTDC) is an autonomous R&D center in Hyderabad, Andhra Pradesh that conducts applied research to develop advanced materials, products and solutions for the high-tech sector. It sets up pilot plants to enable growth of technology centers and trains high-tech research personnel. It receives grant funding from the Ministry’s public sector undertakings.
Centre for Techno-Economic Policy Option New Delhi (C-Tempo)
Centre for Techno-Economic Mineral Policy Options (C-Tempo) is a think tank which provides the Ministry of Mines technological and economic advice regarding policy options. It’s comprised of investors, entrepreneurs, the mining industry and federal and state government. C-Tempo is not directly funded by the government but from grants from the ministry’s public sector undertakings.
Indian governmental budgets have “non-plan” and “plan” outlays. “Non-plan” expenses include capital expenditure, revenue expenditure on interest payments, postal deficit, pensions, economic services, defense expenditure and subsidies. “Non-plan” also includes spending on police, loans & grants to public sector, governments whether state or foreign and Union territories. “Plan” is money needed to execute the Indian government’s Central Plan. It consists of capital & revenue and central assistance to Union territories and states.
- Non-Plan Budget (2012-13): Rs 466.44 crore ($86.35 million USD)
- Plan Budget (2012-13): Rs 2942.64 crore ($ 544.78 million USD)
Secretariat expenditure is Rs 20.28 crore ($3.69 million USD).
Attached or Subordinate Bodies
- Geological Survey of India: Rs 589.29 crore (Plan: Rs 194 crore, Non-Plan: Rs 395.29 crore) ($107.28 million USD total, Plan: $35.32 million USD, Non-Plan: $71.96 million USD)
- Indian Bureau of Mines: Rs 67.50 crore (Plan: Rs 24 crore, Non-Plan: Rs 43.50 crore) ($12.29 million USD total, Plan: $4.37 million USD, Non-Plan: $7.92 million USD)
Public Sector Undertakings (Enterprises)
- National Aluminium Company Limited: Rs 2343 crore ($426.54 million USD)
- Hindustan Copper Limited: Rs 341.14 crore ($62.10 million USD)
- Mineral Exploration Corporation Limited: Rs 19 crore ($3.46 million USD)
Autonomous Bodies
- National Institute of Rock Mechanics, National Institute of Miners’ Health, Jawaharlal Nehru Aluminium Research Development and Design Centre salaries and R&D: Rs 16.37 crore (Salaries: Rs 5.87 crore, R&D: Rs 10.50 crore) ($2.98 million USD total, Salaries: $1.07 million USD, R&D: $1.91 million USD)
Child Labor in Mines
The constitution of India ensures that no child below the age of 14 is allowed to work, especially in a job as hazardous as coal mining. However, use of child labor is a major problem in coalmines, where the coal mafia routinely traffics children from Nepal, Bangladesh and Assam. According to the NGO Impulse Network, based in the Northeastern state of Meghalaya, over 70,000 children work in mines in that state’s Jaintia Hills District alone. The issue is made more difficult to police by that fact that state is poorly governed, suffers from subpar infrastructure, and is remote so rescuing kids from the mine is difficult.
Meghalaya: Braveheart Fights against Child Labour in Coal Mines (by Arijit Sen – CNN IBN)
India's Child Coal Miners (by Daniel Etter, Christian Science Monitor)
Indian Child Miners Unaffected by Labour Laws (by Julien Bouissou, Guardian Weekly)
Should Mining Be Banned in Coastal Areas?
Background
The Supreme Court in 2006 banned mining in the Western Ghats and ordered the state-owned Kudremukh to shut down mining of magnetite, a low grade iron ore with magnetic property used in steel manufacturing. Illegal mining in Karnataka has recently been stopped and there is an increasing pressure to stop mining in environmentally sensitive areas. The private mines in Karnataka have gone through an extensive rehabilitation and reclamation plans that have been approved before being allowed to begin mining again.
Pro-Coastal Mining
A task force set up by the Steel Ministry has proposed underground mining of iron ore in the coastal areas. The ministry argues that the iron ore deposits in the country are fast depleting and underground mining could solve the problem of ore shortages. The environmental issues and bans on mining in the coastal areas have led to severe shortages of ores for the user industries.
Steel Ministry for Key Changes in Mining Bill (by Sudheer Pal Singh, Business Standard)
New Mining Bill: Steel, Mining Ministries Differ on Benefits of Captive Allocation (by Meera Mohanty, Economic Times)
Anti-Coastal Mining
According to the July 2012 HRW report Out of Control, even the so-called legal mining in Karnataka and Goa “illustrate broader patterns of failed regulation, alleged corruption and community harm. It shows how even mines operating with the approval of government regulators are able to violate the law with complete impunity.”
The report continues: “Some communities in Goa resort to making use of surface water for at least part of the year because their groundwater supplies have been damaged or destroyed by nearby mining operations.”
Task Force Suggests Underground Mining in Western Ghats (by Meera Mohanty, Economic Times)
Private Iron Ore Mines in Karnataka to Open by Month End (by Anshul Dhamija, Times of India)
The DESPICABLE Illegal Mining HORROR of India (by Vicky Nanjappa, Rediff News)
Good? Bad? Ugly? Why They Put Four Women in the Jug (by Hartman de Souza, SaveGoa.org)
Out of Control (Human Rights Watch) (pdf)
Allow Competitive Bidding for Mineral Resources
Background
The proposed mining bill wants auctioning of natural resources and scrap reservation of public sector undertakings and prior approval of the central government for giving mining rights. The bill has already been approved by a group of ministers and has been placed at Parliament. Competitive bidding is proposed to attract private investment in the mining sector. The mining ministry also feels that captive allocation of mines to end users like steel plants often lead to suboptimal use of capacities. The steel ministry has raised objections to the auctioning process proposed in the draft mining bill. The ministry, which oversees a number of PSUs that have iron ore and coal mining rights, is worried that the mines will be auctioned through competitive bidding after the leases expire.
Pro-Competitive Bidding
Mining industries and ministry wants competitive bidding in natural resources so that there is more investment in the sector. The Comptroller of Auditor General (CAG) has indicted the coal ministry for allocating coalmines to power and steel companies without competitive bidding. Out of the 54 captive coalmines allocated between 2006 and 2009, only one mine has begun production. The main Opposition Party, Bharatiya Janata Party, has demanded that the mining policy is changed immediately so that mines are allocated only through competitive bidding.
New Mining Bill: Steel, Mining Ministries Differ on Benefits of Captive Allocation (by Meera Mohanty, Economic Times)
Anti-Competitive Bidding
User industries like steel and power are concerned that they will not be able to bid at competitive rates if mines are auctioned. Coal India is also against competitive bidding as it is worried that foreign coal companies will bid at lower prices.
CAG Puts Coal Loss at R1.86 L cr, Blames Both Centre & States (Indian Express)
Investing in Infrastructure to Drive Steel Demand
One of India’s oft-stated goals is to increase its lackluster infrastructure. The steel industry is under the pressure as a result of the global recession. A double dip in the European economy has affected adversely the European operations of the leading private companies in the sector, like Tata Steel, the world’s seventh largest steel producer. The Indian steel demand is also slowing down with the lower GDP figures. The 12th Plan thrust on infrastructure, with plans to build ports, airports, roads, railways, power and coal will boost the demand for steel as the infrastructure sector has an elasticity of 0.8% with consumption of steel. The ministry should frame the new policy in such a manner that would boost consumption demand for steel.
Apart from falling demand, the other major problem with the steel industry is the high cost of fuel, with inadequate domestic supplies of coking coal. A fall in coking coal price, with lower global demand, is fuelling Indian steel producers step up imports. Although some private steel manufacturers have acquired coal mines abroad, others are dependent on domestic coal. The steel ministry should ensure that the steel plants begin operations in the captive mines urgently.
Rise in Infrastructure Spending to Boost Demand: SAIL Chairman (NDTV)
Infrastructure Spend to Boost Steel Demand, Move to Preserve Resource Welcomed (Financial Express)
Speed Up Approval Process
The long delays in setting up big-ticket investments in steel plants have not only affected sentiments of foreign investment but have also resulted in supply constraints. The ministry should make attempts to attract investment in other less sensitive areas. For example, while POSCO struggles with starting construction of the large but delayed plant in Odisha, it has begun to build a smaller hot galvanized steel plant in Maharashtra to cater to the demand of the demands of the automobile and consumer demand sectors. Arcellor Mittal has also announced building a smaller plant in non-tribal areas of Jharkhand in lieu of the plant in Chhattisgarh. L N Mittal, owner of Arcellor Mittal, has been vocal in expressing his anguish over the delays with land acquisition in Chhattisgarh. The steel ministry should make attempts at allaying such fears of foreign investors.
Fumbling Ministry to Blame for Posco Project Mess (Mail Today)
Bijoy Krishna Handique
Bijoy Krishna Handique served as the Minister of Mines from May 2009 to January 2011. Born on December 1, 1934, Handique is the only son of Krishna Kanta Handique, a renowned Indologist. He is also the father in law of Abheek Barman, a journalist with the Times of India. A member of the 15th Lok Sabha of India, he represents the Jorhat constituency of Assam and is a member of the Indian National Congress (INC) political party. He was elected to the Assam State Assembly in 1971 from the Jorhat Town constituency, and served as a Rajya Sabha member from 1980 to 1986. Handique previously was appointed a Minister of State for Defence and Parliamentary Affairs in 2004, and subsequently was a Minister of State for Chemicals & Fertilizers and Mines up to 2009.
Bijoy Krishna Handique (Wikipedia)
- Table of Contents
- Overview
- History
- What it Does
- Where Does the Money Go
- Controversies
- Debate
- Suggested Reforms
- Former Directors
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- Leave a comment
Ministry of Mines
Ministry of Mines is responsible for the overall development and administration of laws and regulations regarding excavating minerals (natural gases, petroleum and atomic minerals) and non-ferrous metals. It also oversees the Mines and Minerals (Regulation and Development) Act, 1957, which covers all mines and minerals; however, the ministry’s oversight does not cover coal, natural gas and petroleum.
India produces 87 minerals - four fuel, 10 metallic, 47 non-metallic, three atomic and 23 minor minerals (including building and other materials).
India’s mining history dates back to 3rd millennium BCE when flint was used. Lead and zinc mining in Rajasthan began in 1260 BC. By the 4th century BCE, there was a detailed account of metal and mineral properties and their large-scale production along with manufacturing brass, bronze, gold and silver alloys in “Arthasastra.” This treatise is believed to be written by Chanakya, a professor of economics and political science at the ancient Takshashila University. However, there is debate over authorship date, either 4th century BCE or 2nd century AD.
Between 1400-1800, individual kingdoms had their own rules for mining until the Mughals established more strict regulatory controls. Mysore, an Indian Princely state until independence, had its own safety regulations.
In 1851, the Geological Survey of India (GSI) was formed. Secretary of State Lord Cross proposed inspection and regulation of mining operations in 1890. The first Inspector of Mines, James Grundy, worked the GSI to inspect mines and make regulation recommendations. The Mines Act of 1901 covered all minerals (up to 6 meters deep) and provided for inspectors, managers, greater powers for the chief inspector and prohibited the employment of children.
In 1948, the Indian Bureau of Mines (IBM) was established as the main agency to monitor and supervise mining activities.
The Mines and Minerals (Development & Regulation) Act, 1957, confirmed regulation of mines and development of minerals under Union control; however, the ministry’s oversight did not cover coal, natural gas and petroleum.
India’s economy liberalized in 1991, and in March 1993, the National Mineral Policy was created to encourage private investment.
The Mines and Minerals (Development and Regulation) Bill, 2011, was prepared by the ministry to replace the existing Mines and Minerals (Development and Regulation) Act, 1957. The bill would reform the mining industry by addressing sustainability issues, transparency, good mining practices, local area development and introduce profit-sharing to people affected by mining operations. Although approved by the Cabinet in September 2011, it was still being debated in 2012.
Ministry of Mines manages the overall surveying and exploration of all minerals and metals except natural gases, petroleum and atomic minerals. It creates legislation regulating mines and the development of minerals. Mines and minerals include those under the ocean within the territorial waters, the continental shelf, special economic zones and other Indian maritime areas.
The ministry oversees metallurgy of non-ferrous metals such as aluminum, copper, zinc, lead, gold and nickel. It also handles gems such as diamonds and emeralds.
The ministry also administers the Mines and Minerals (Regulation and Development) Act, 1957, which covers all mines and minerals except coal, natural gas and petroleum.
Attached or Subordinate Bodies
The Geological Survey of India (GSI) is an attached office to the ministry. It provides basic earth science information and is an active participant in international geoscientific discussions.
The Indian Bureau of Mines is a subordinate office of the ministry. It promotes conservation and development of mineral resources and encourages environmental protection in mines, with the exception of coal, petroleum, natural gas, atomic minerals and minor minerals.
Public Sector Undertakings (Enterprises)
National Aluminium Company Limited (NALCO)
Incorporated as a public sector enterprise of the ministry in 1981, NALCO is Asia’s largest and the world’s sixth largest aluminum complex. Headquartered in Bhubaneswar, Orissa, it operates bauxite mining, alumina refining, aluminum smelting and casting, power generation and has rail and port operations. NALCO is one of India’s most profitable public sector firms.
Hindustan Copper Limited (HCL)
Hindustan Copper Limited (HCL) was incorporated on November 9, 1967. It is India's only vertically integrated copper producing company consisting of mining, beneficiation, smelting, refining and casting of refined copper metal. It also produces gold, silver, nickel sulphate, selenium, tellurium and fertilizer as by-products. It has plants and Jharkhand, Madhya Pradesh, Rajasthan and Maharashtra.
Mineral Exploration Corporation Limited (MECL)
Established on October 21, 1972, Mineral Exploration Corporation Limited (MECL) conducts exploration for minerals. Services include reconnaissance, mapping, sampling, drilling/mining and environmental studies and are done as Promotional (on behalf of the government of India) or contractual (on behalf of public sector, private sector and state government agencies).
Autonomous Bodies
National Institute of Rock Mechanics (NIRM)
Formed in 1988, the National Institute of Rock Mechanics (NIRM) is a research center for applied and basic rock mechanics. It provides research and consultancy services to the mining and civil engineering industries in order to improve safety and productivity. NIRM handles scientific design of mine workings, design of rock excavations and support systems, site characterization practices and conducts advanced research in rock mechanics and ground control.
National Institute of Miners’ Health (NIMH)
National Institute of Miners’ Health (NIMH)’s overall objective is to ensure the health safety of miners through prevention of occupational diseases. It conducts medical examinations, personal/environmental/machinery assessments for noise, dust, vibrations and presence of toxins and safety research. The NIMH also assists enforcement agencies and the mining industry to comply with national and international standards. It formed on May 11, 1989, and formally became an “autonomous body” on February 21, 1990.
Jawaharlal Nehru Aluminium Research Development and Design Centre (JNARDDC)
Located in Nagpur, Maharashtra, the Jawaharlal Nehru Aluminium Research Development and Design Centre (JNARDDC) studies bauxite, alumina and aluminum and offers the following services: research and development, testing and training. Secondarily, the JNARDDC offers analytical and testing facilities to other non-ferrous industries, steel industries and small-scale industries.
Registered Societies
These institutions are administered by the ministry but do not receive funding directly from the government.
Non-ferrous Materials Technology Development Centre, Hyderabad (NFTDC)
Nonferrous Materials Technology Development Centre (NFTDC) is an autonomous R&D center in Hyderabad, Andhra Pradesh that conducts applied research to develop advanced materials, products and solutions for the high-tech sector. It sets up pilot plants to enable growth of technology centers and trains high-tech research personnel. It receives grant funding from the Ministry’s public sector undertakings.
Centre for Techno-Economic Policy Option New Delhi (C-Tempo)
Centre for Techno-Economic Mineral Policy Options (C-Tempo) is a think tank which provides the Ministry of Mines technological and economic advice regarding policy options. It’s comprised of investors, entrepreneurs, the mining industry and federal and state government. C-Tempo is not directly funded by the government but from grants from the ministry’s public sector undertakings.
Indian governmental budgets have “non-plan” and “plan” outlays. “Non-plan” expenses include capital expenditure, revenue expenditure on interest payments, postal deficit, pensions, economic services, defense expenditure and subsidies. “Non-plan” also includes spending on police, loans & grants to public sector, governments whether state or foreign and Union territories. “Plan” is money needed to execute the Indian government’s Central Plan. It consists of capital & revenue and central assistance to Union territories and states.
- Non-Plan Budget (2012-13): Rs 466.44 crore ($86.35 million USD)
- Plan Budget (2012-13): Rs 2942.64 crore ($ 544.78 million USD)
Secretariat expenditure is Rs 20.28 crore ($3.69 million USD).
Attached or Subordinate Bodies
- Geological Survey of India: Rs 589.29 crore (Plan: Rs 194 crore, Non-Plan: Rs 395.29 crore) ($107.28 million USD total, Plan: $35.32 million USD, Non-Plan: $71.96 million USD)
- Indian Bureau of Mines: Rs 67.50 crore (Plan: Rs 24 crore, Non-Plan: Rs 43.50 crore) ($12.29 million USD total, Plan: $4.37 million USD, Non-Plan: $7.92 million USD)
Public Sector Undertakings (Enterprises)
- National Aluminium Company Limited: Rs 2343 crore ($426.54 million USD)
- Hindustan Copper Limited: Rs 341.14 crore ($62.10 million USD)
- Mineral Exploration Corporation Limited: Rs 19 crore ($3.46 million USD)
Autonomous Bodies
- National Institute of Rock Mechanics, National Institute of Miners’ Health, Jawaharlal Nehru Aluminium Research Development and Design Centre salaries and R&D: Rs 16.37 crore (Salaries: Rs 5.87 crore, R&D: Rs 10.50 crore) ($2.98 million USD total, Salaries: $1.07 million USD, R&D: $1.91 million USD)
Child Labor in Mines
The constitution of India ensures that no child below the age of 14 is allowed to work, especially in a job as hazardous as coal mining. However, use of child labor is a major problem in coalmines, where the coal mafia routinely traffics children from Nepal, Bangladesh and Assam. According to the NGO Impulse Network, based in the Northeastern state of Meghalaya, over 70,000 children work in mines in that state’s Jaintia Hills District alone. The issue is made more difficult to police by that fact that state is poorly governed, suffers from subpar infrastructure, and is remote so rescuing kids from the mine is difficult.
Meghalaya: Braveheart Fights against Child Labour in Coal Mines (by Arijit Sen – CNN IBN)
India's Child Coal Miners (by Daniel Etter, Christian Science Monitor)
Indian Child Miners Unaffected by Labour Laws (by Julien Bouissou, Guardian Weekly)
Should Mining Be Banned in Coastal Areas?
Background
The Supreme Court in 2006 banned mining in the Western Ghats and ordered the state-owned Kudremukh to shut down mining of magnetite, a low grade iron ore with magnetic property used in steel manufacturing. Illegal mining in Karnataka has recently been stopped and there is an increasing pressure to stop mining in environmentally sensitive areas. The private mines in Karnataka have gone through an extensive rehabilitation and reclamation plans that have been approved before being allowed to begin mining again.
Pro-Coastal Mining
A task force set up by the Steel Ministry has proposed underground mining of iron ore in the coastal areas. The ministry argues that the iron ore deposits in the country are fast depleting and underground mining could solve the problem of ore shortages. The environmental issues and bans on mining in the coastal areas have led to severe shortages of ores for the user industries.
Steel Ministry for Key Changes in Mining Bill (by Sudheer Pal Singh, Business Standard)
New Mining Bill: Steel, Mining Ministries Differ on Benefits of Captive Allocation (by Meera Mohanty, Economic Times)
Anti-Coastal Mining
According to the July 2012 HRW report Out of Control, even the so-called legal mining in Karnataka and Goa “illustrate broader patterns of failed regulation, alleged corruption and community harm. It shows how even mines operating with the approval of government regulators are able to violate the law with complete impunity.”
The report continues: “Some communities in Goa resort to making use of surface water for at least part of the year because their groundwater supplies have been damaged or destroyed by nearby mining operations.”
Task Force Suggests Underground Mining in Western Ghats (by Meera Mohanty, Economic Times)
Private Iron Ore Mines in Karnataka to Open by Month End (by Anshul Dhamija, Times of India)
The DESPICABLE Illegal Mining HORROR of India (by Vicky Nanjappa, Rediff News)
Good? Bad? Ugly? Why They Put Four Women in the Jug (by Hartman de Souza, SaveGoa.org)
Out of Control (Human Rights Watch) (pdf)
Allow Competitive Bidding for Mineral Resources
Background
The proposed mining bill wants auctioning of natural resources and scrap reservation of public sector undertakings and prior approval of the central government for giving mining rights. The bill has already been approved by a group of ministers and has been placed at Parliament. Competitive bidding is proposed to attract private investment in the mining sector. The mining ministry also feels that captive allocation of mines to end users like steel plants often lead to suboptimal use of capacities. The steel ministry has raised objections to the auctioning process proposed in the draft mining bill. The ministry, which oversees a number of PSUs that have iron ore and coal mining rights, is worried that the mines will be auctioned through competitive bidding after the leases expire.
Pro-Competitive Bidding
Mining industries and ministry wants competitive bidding in natural resources so that there is more investment in the sector. The Comptroller of Auditor General (CAG) has indicted the coal ministry for allocating coalmines to power and steel companies without competitive bidding. Out of the 54 captive coalmines allocated between 2006 and 2009, only one mine has begun production. The main Opposition Party, Bharatiya Janata Party, has demanded that the mining policy is changed immediately so that mines are allocated only through competitive bidding.
New Mining Bill: Steel, Mining Ministries Differ on Benefits of Captive Allocation (by Meera Mohanty, Economic Times)
Anti-Competitive Bidding
User industries like steel and power are concerned that they will not be able to bid at competitive rates if mines are auctioned. Coal India is also against competitive bidding as it is worried that foreign coal companies will bid at lower prices.
CAG Puts Coal Loss at R1.86 L cr, Blames Both Centre & States (Indian Express)
Investing in Infrastructure to Drive Steel Demand
One of India’s oft-stated goals is to increase its lackluster infrastructure. The steel industry is under the pressure as a result of the global recession. A double dip in the European economy has affected adversely the European operations of the leading private companies in the sector, like Tata Steel, the world’s seventh largest steel producer. The Indian steel demand is also slowing down with the lower GDP figures. The 12th Plan thrust on infrastructure, with plans to build ports, airports, roads, railways, power and coal will boost the demand for steel as the infrastructure sector has an elasticity of 0.8% with consumption of steel. The ministry should frame the new policy in such a manner that would boost consumption demand for steel.
Apart from falling demand, the other major problem with the steel industry is the high cost of fuel, with inadequate domestic supplies of coking coal. A fall in coking coal price, with lower global demand, is fuelling Indian steel producers step up imports. Although some private steel manufacturers have acquired coal mines abroad, others are dependent on domestic coal. The steel ministry should ensure that the steel plants begin operations in the captive mines urgently.
Rise in Infrastructure Spending to Boost Demand: SAIL Chairman (NDTV)
Infrastructure Spend to Boost Steel Demand, Move to Preserve Resource Welcomed (Financial Express)
Speed Up Approval Process
The long delays in setting up big-ticket investments in steel plants have not only affected sentiments of foreign investment but have also resulted in supply constraints. The ministry should make attempts to attract investment in other less sensitive areas. For example, while POSCO struggles with starting construction of the large but delayed plant in Odisha, it has begun to build a smaller hot galvanized steel plant in Maharashtra to cater to the demand of the demands of the automobile and consumer demand sectors. Arcellor Mittal has also announced building a smaller plant in non-tribal areas of Jharkhand in lieu of the plant in Chhattisgarh. L N Mittal, owner of Arcellor Mittal, has been vocal in expressing his anguish over the delays with land acquisition in Chhattisgarh. The steel ministry should make attempts at allaying such fears of foreign investors.
Fumbling Ministry to Blame for Posco Project Mess (Mail Today)
Bijoy Krishna Handique
Bijoy Krishna Handique served as the Minister of Mines from May 2009 to January 2011. Born on December 1, 1934, Handique is the only son of Krishna Kanta Handique, a renowned Indologist. He is also the father in law of Abheek Barman, a journalist with the Times of India. A member of the 15th Lok Sabha of India, he represents the Jorhat constituency of Assam and is a member of the Indian National Congress (INC) political party. He was elected to the Assam State Assembly in 1971 from the Jorhat Town constituency, and served as a Rajya Sabha member from 1980 to 1986. Handique previously was appointed a Minister of State for Defence and Parliamentary Affairs in 2004, and subsequently was a Minister of State for Chemicals & Fertilizers and Mines up to 2009.
Bijoy Krishna Handique (Wikipedia)
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