Yearender: Worst not yet over for India's mining sector

Dec 29 2013, 16:39 IST
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SummaryWhile ban on iron ore mining in Goa continued throughout 2013, production of the mineral in Karnataka is yet to stabilise.

As the new year knocks on the door, iron ore mining industry - which is going through the most trying times following the Supreme Court restrictions - continues to grapple with challenges.

While ban on iron ore mining in Goa continued throughout 2013, production of the mineral in Karnataka is yet to stabilise.

Many mines in the Southern state are yet to reopen for want of clearances, even though the Supreme Court in April had lifted nearly 2-year old ban with some stiff conditions.

The impact of the decisions on mining will continue to be felt in the new year, especially in Goa where the economy to a large extent is dependent on mining and related activities.

Odisha - the largest iron ore producing state - is also facing issues like excess production and may possibly be heading for a ban in the new year due to a 5-volume explosive report of Justice M B Shah Commission that was submitted to the Union Mines Ministry in two parts - in July and October.

Contents of the report have not yet been made public but official sources said that the Commission has said that "all modes of illegal mining is being carried out" in Odisha and miners are "making super normal profits".

Besides, it has also said that miners in the state "illegally and without lawful authority" have extracted iron ore worth thousands of crores, they said.

Various issues including large scale violation of environment and forest laws, pollution in the mining areas and its impact on local population, flora and fauna have been dealt extensively by the Commission, whose report led to the Supreme Court banning all mining in Goa, the sources said.

The report is likely to be tabled in the next Parliament session and may provide the much needed ammunition to the political parties and activists against the Naveen Patnaik government just before the Lok Sabha elections.

The Indian economy also felt the tremors of the impact of mining bans in 2013. While the Indian GDP grew at the rate of 4.6 per cent in the first half of the current fiscal, the mining sector continued its negative growth trend of two previous fiscals and contracted by 1.6 per cent during April-September, 2013.

Commerce Minister Anand Sharma told PTI: "It (mining ban) has hurt our economy. It has hurt exports, (particularly) iron ore exports... We could have earned by exporting around 100 million tonnes of iron ore, we

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