FACTS & FIGURES
The index of mineral production comprising mining and quarrying sector was reported to be higher by 7.9% in December 2012 vis-à-vis the preceding month. The mineral sector has shown a negative growth of 4.0% during December 2012 vis-à- vis same period in the previous year. The total value of mineral production (excluding atomic & minor minerals) in India during December 2012 was ` 18,195 crore. In December 2012, the production was coal was reported at 535 lakh tonne, lignite (38 lakh tonne), natural gas (utilized) 3244 million cu. m., petroleum (crude) at 32 lakh tonne, bauxite (1042 thousand tonne), chromite (202 thousand tonne), copper conc. (11 thousand tonne), gold (150 kg.), iron ore (99 lakh tonne), lead conc (16 thousand tonne), manganese ore (195 thousand tonne), zinc conc.(139 thousand tonne), apatite & phosphorite (167 thousand tonne), dolomite (428 thousand tonne), limestone (224 lakh tonne), magnesite (19 thousand tonne) and diamond (2367 carat). In December
2012 the output of magnesite increased by 16.9%, lignite 16.9%, coal 15.8%, chromite 15.2%, diamond 14.9%, bauxite 11.9%, manganese ore 8.3%, gold 7.9%, iron ore 5.8%, copper conc. 3.7%, zinc conc. 3.2%, petroleum (crude) 3.2% and natural gas (utilized) 2.6 percent. However the production of limestone decreased by 0.3%, lead conc. 5.4%, dolomite 6.2% and apatite & phosphorite 28.5 percent.
COAL SUPPLY & PRICING
Negotiations are happening with all the stakeholders to sort the issue of coal pricing and assured supply. Recently, the government has given in-principle approval for coal price pooling that would ensure higher fuel supplies to stranded power projects across India.The revised fuel supply agreements (FSAs) are likely to ensure assured supply of coal for number of power plants in India. The shift in gross calorific value (GCV) based grading of coal would align domestic prices with international benchmarks. India’s coal imports are expected to rise to 185 MT by 2016-17 due to increase in demand from power sector.To overcome the supply issues following measures are proposed:
1. Competitive bidding for allocation of captive blocks to private companies is proposed.The coal ministry has identified 54 coal blocks for auctioning. The ministry is likely to put 12 explored blocks in the first round for auctioning.
2. Increase in coal production by Coal India Ltd (CIL).
IRON ORE ISSUES
Iron ore is key input in the production of steel. Illegal mining activities in Karnataka led to halt in production and ultimately started affecting the steel industry. The apex court has allowed ore auctioning to take care of the needs of the local steel producers. In Orissa, around 196 mining lease holders were fined over Rs 37,900 crore for mining in excess of the allotted quota and not adhering to statutory rules last year. Sectoral cleansing is happening in most of the states like Goa, Karnataka and Orissa. Supreme Court probe panel had advocated rehabilitation scheme to be put in place before resume mining activities.
BANNING OF ORE EXPORTS
The Committee on Public Undertaking (2010-11) in its 11th report had interalia recommended that export of raw natural resources like iron ore, coal needs to be banned after doing a comprehensive examination of Rashtriya Ispat Nigam Ltd. The iron ore exports are restricted through imposition of export duty. The Central Government had increased the export duty on iron ore from 20% to 30% advalorem on all grades of iron ore (except pellets) with effect from 30.12.2011.
The economic survey 2012-13 has pointed slowdown in a mining and quarrying activities as a reason for poor industrial growth. Mining operations in Goa, Karnataka and Orissa were down last year due to allegations of illegal activities. It is expected that the proposed new norms for auctioning mining blocks would aim at ensuring fair play in allocation of the mining reserves and better pricing of natural resources.