MINING SECTOR IN INDIA PPT

BY NISHA CHAUHAN.

WHAT IS MINING? Mining is the extraction of valuable minerals or

other geological materials from the earth. There are various typea of Ores recovered by

mining include metals, coal , limestone Mining is required to obtain any material

that cannot be grown through agricultural processes, or created artificially in a laboratory or factory.

Mining in a wider sense includes extraction of any non-renewable resource such as petroleum, natural gas, or even water.

INDIAN MINING SECTOR

India is endowed with significant mineral resources. India produces 89 minerals.

In India, 80% of mining is in coal and the balance 20% is in various metals and other raw materials such as gold, copper.

India ranks 3rd in production of coal & lignite production.

11 the in crude steel in the World. Over 1.1 million people are employed in the

Indian mining industry.  With over 2,326 private and 292 public operating mines in the country, minerals form 16 percent of India's exports.

MINING SECTOR PROGRESS

WHO IS THE OWNER OF MINERALS IN INDIA?

The State (provincial) Governments are the owners of minerals located within the boundary of the State concerned. The Central Government is the owner of the minerals underlying the ocean within the territorial waters

What is a Recognized Permit? It Is granted for preliminary prospecting of a

mineral through regional , aerial, geophysical or geochemical surveys and geological mapping.

WHAT IS THE PERIOD AND TENURE FOR WHICH A ‘RECONNAISSANCE PERMIT’ IS GRANTED?

A RP for any mineral or prescribed group of associated minerals is granted for 3 years and for a maximum area of 5,000 square kilometer.

At the end of 3 years, area held under a RP should be reduced to 25 square kilometer.

A RP cannot be renewed. In a State (Province), a person can be granted

a maximum area of 10,000 square kilometer in 2 or more RPs

WHO GRANTS MINERAL CONCESSIONS AND WHO CAN GET CONCESSION?

The State Governments grant the mineral concessions for all the minerals located within the boundary of the State, under provisions of the Mines and Minerals (Development and Regulation) Act, 1957 and Mineral Concession Rules, 1960.

Any ‘person’ who is either an Indian national or a company registered in India Companies Act, 1956 is eligible to obtain mineral concessions. While in case of an individual, the ‘person’ should be a citizen of India, in case of a firm or other association of individuals, all members of the firm or members of the association should be citizens of India

MINE LIFECYCLE

1. Exploration Phase2. Design Phase3. Construction Phase4. Production Phase5. Post Closure Phase6. Closure Phase

Production

• Once construction is complete and systems have been tested, mineral production can begin

• It involves recovering, processing and transporting the minerals this process last depending on the size and type of the mineral deposit.

Post Closure Phase

• Upon closing operations, measures must be taken to address environmental impacts that include water, vegetation and erosion..

Closure Phase

• a mine has a finite life span, and each site has a mine closure.

• includes dismantling the facilities and returning the mine site to a safe, stable and reclaimed state.

• Mine closure takes, on average, one to five years.

ExplorationPhase

• It Involve land issues • bring an influx of a few job.• some economic development

through the purchase of local goods and services.

Design Phase

• This phase helps mining companies determine if and how a project can be safe, environmentally sound

• socially responsible, while meeting or exceeding regulatory requirements

Construction Phase

• This may take two years or more and involves building roads, processing facilities

• environmental management systems, employee housing and other facilities

CONTRIBUTION TO THE PUBLIC SECTOR

The public sector contributes over 85 percent of the total value of mineral production. 

Public sector enterprises like the National Mineral Development Corporation, Kudremukh Iron Ore company, Steel Authority of India Limited and Orissa Mining Corporation dominate the iron ore sector.

Coal Mining is predominantly a public sector activity - Coal India Ltd. (CIL) accounts for 85% of total coal production.

WHAT IS THE POLICY FOR FOREIGN DIRECT INVESTMENT IN THE MINING SECTOR The entrepreneurs desirous of bringing in

foreign direct investment in the non-fuel and non-atomic mineral mining sector are eligible to bring in the foreign equity just by informing the Reserve Bank of India, termed as ‘ automatic approval’.

Automatic approval of foreign direct investment up to 100% is permissible for exploration and exploitation of all non-fuel and non-atomic minerals.

A SWOT ANALYSIS OF INDIAN MINING INDUSTRY

Strengths:

1. The government offers a wide range of concessions to investors in India, engaged in mining activity.

Mining in specified backward districts is eligible for a complete tax holiday for a period of 5 years from commencement of production and a 30 percent tax holiday for 5 years thereafter.

Environment protection equipment, pollution control equipment, energy saving equipment and certain other equipment eligible for 100 percent depreciation.

STRENGTHS: 2. Labors easily available3. Low labor and conversion costs.4. Large quantity of high quality reserves.5. Strategic location .

WEAKNESS:

1. Poor infrastructure facilities2. Mining technology is outdated3. Low innovation capabilities4. Labor force is highly un-skilled and

inexperience. High rate of accidents.5. Lack of R&D programs and training and

development.

THE OPPORTUNITIES

1. India has an estimated 85 billion tones of mineral reserves remaining to be exploited.

2. Potential areas for exploration ventures include gold, diamond, copper, lead, tin, silver, platinum group of metals.

3. The main opportunities in the mining sector (excluding coal and industrial minerals) are in the development and production of surplus commodities such as iron ore and bauxite, mica, potash, few ores, mining of small gold deposits.

THREATS:

1. Mining companies and equipment suppliers are under the constant threat of being taken over by foreign companies.

2. Politicians undervalue the industry's contributions to the economy.

3. Stricter environment rules restricting mining activities.

FACTORS AFFECTING MINING

Geological availability - a successful mine or quarry must be based on a deposit that has value.Stable ownership regime - Mines require substantial investment. Investors will need to be assured that their investment won't be confiscated by governments or others who shared none of the risks.Exploration - the geologic concentration needs to be found.Transport - some bulk materials need to be close to markets or at least to low cost transportation. For example iron ore deposits need to be within a few hundred miles of steel mills or ocean transportation.

FACTORS AFFECTING MININGMining methods - some methods are much cheaper than others.Environmental factors - almost all countries require an analysis of environmental impacts before mining can start.Management skills - some people can manage mines better than others.

MAJOR PLAYERS1. National Mineral Development

CorporationCorporate office – Hyderabad, Andhra Pradesh.

A government of India organization and comes under the Ministry of steel, it is the largest iron ore producer in the country.

2. Hindalco Industries Corporate office – Mumbai, Maharashtra . Hindalco Industries is a company of Aditya

Birla and one among the top 10 mining companies in India.

MAJOR PLAYERS3. Gujarat Mineral Development Corporation

Corporate office – Ahmadabad, Gujarat . Gujarat mineral development corporation limited is a

leading mining company in India The organization is engaged in production of lignite, bauxite.

4. Vedanta Resource Corporate office – London, UK . Among the top mining companies in India, Vedanta

resource is a metal and mining organization . The company is operating in many countries including India

IMPACT OF MINING

The environmental impact of mining includes erosion, formation of sinkholes, loss of biodiversity, and contamination of soil, groundwater and surface water by chemicals from mining processes.

Besides creating environmental damage, the contamination resulting from leakage of chemicals also affect the health of the local population.

mining may cause destruction and disturbance of ecosystems and habitats.

In urbanised environments mining may produce noise pollution, dust pollution and visual pollution.

IMPACT OF MINING

MINING SECTOR IS CYCLIC The cyclical nature of the mining industry poses a

unique challenge for education and training institutions. Changing market conditions not only affect enrolment rates but also alter requirements for new training.

Cyclical downturns in the mining, oil and natural gas industries, or in the oilfield and mining services businesses, may have amaterial adverse effect on the financial condition or results of operations.

SECTOR PROSPECTS

The total mineral potential area in India covers 5.75 lakh sq. km., of which an area of only 75,000 sq. km. has been explored in detail so far.

According to industry estimates, the mining industry turnover is projected at $30 billion by 2012. The future demand for mining products will be driven by a growing Indian economy, resurging industrial production & rapid infrastructure development.