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Mining ban hurting Indian exports: Commerce Minister

26 Dec 2013 Evaluate

Amid rising concerns over the slowing down of India’s exports' growth to 6 percent in November from double digit growth witnessed in the past few months, Commerce and Industry Minister Anand Sharma has asserted that ban on mining by the Supreme Court has been impacting country’s exports particularly iron ore, besides, has also increased India's dependence on imported coal. The Supreme Court had banned iron ore mining in Goa in October 2012 and in Karnataka in July-August 2011.

Highlighting that India could substantially earn by exporting around 100 million tonnes of iron ore, Minister added that the country has been deprived of foreign exchange which it would have earned by ore exports. Furthermore, owing to the mining ban, shipments of iron ore plunged to 18 million tonnes in 2012-13 from nearly 168 million tonnes in 2010-11. On the other hand, coal imports bill has increased to $22 billion, reflecting need for serious assessment, he added. Despite the world's fifth largest in terms of reserves and third-largest producer of coal, India's domestic output has failed to keep pace with demand over the past few years. Coal production with weightage of 4.38% in IIP index declined by 3.9% in October, 2013 over the same period of corresponding period. Presently, Coal India is the only producer of domestic coal, which is also struggling to meet domestic requirement. Acute coal shortages in the country have become primary reason for power deficit in the country as coal-fired plants account for 57% of India's installed electricity capacity.

The mining sector, having around 14 percent weight in Index of Industrial Production (IIP), witnessed a contraction of 2.7 percent during April-October’2013 as against a dip of 1 percent in the same period last fiscal. In coming future, mining sector is likely to remain under pressure because of various mining restrictions.

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