Indian mining leases too small to be sustainable – FIMI

KOLKATA (miningweekly.com) – The size distribution of mining leases in India are so small that these neither sustainable, nor mined scientifically, according to Federation of Indian Mineral Industries (FIMI).

According to data provided in a FIMI report, on March 31, 2017, there were 4 128 mining leases of major minerals effective across the country, covering 354 908 ha. Of this, 72% of the mining leases were less than 50 ha. There were only four mining leases covering 500 ha or more and five leases covering 200 ha to 500 ha.

The small size distribution of mining leases in India is not only an impediment to sustainable the scientific mining, but also a major speed-breaker for the mining industry towards achieving its full potential of generating employment, FIMI said in a report.

Data cited by the miners’ body shows that employment elasticity of the Indian mining industry to be 0.52% against 1.13% for construction, 0.66% finance and real estate and 0.09% in manufacturing.  Employment elasticity being the measure of percentage change in employment associated with 1% change in economic growth with low or negative employment elasticity indicating “jobless growth”.

Even though the mining industry hold the potential of generating 13 times more jobs than agriculture and six times more than manufacturing, ‘business as usual’ in the Indian mining industry will have 2.64-million jobs by 2022, against 3.32-million jobs at present, while a policy thrust ensuring higher growth in mining could lead to 4.82-million jobs by 2025, FIMI claims.

However, contrary to the potential of the industry, citing historical data, FIMI notes that the industry has actually experienced job losses over the past few years.

Citing the case of southern state of Karnataka, it said that there were 880 000 direct and indirect job losses in 2011 when 166 mines closed down in 2011. In western coastal state of Goa, 400 000 people lost their jobs when the renewal of 88 mining leases were set aside by the courts in 2018 and mining continues to be a limbo since then. Odisha state too has suffered direct and indirect job losses since huge penalties were imposed on miners, although FIMI does not specify the number of such job losses in this state.