⛏ Dig In: India's Latest Aatmanirbhar Move in the Mining Industry
The Indian Mining Industry is poised for a never seen earlier transformation. Dig in to get the complete scoop!
The Indian government has announced a groundbreaking move.
For the first time ever, it is set to pay 30% advance payments for critical mineral exploration!
Now, what does this mean? And why is it a big deal?
Read on.
The Big News
The government will allow private companies to explore 29 critical and deep-seated minerals, including cobalt, lithium, and nickel.
These aren't your everyday minerals – they are crucial for sectors like energy and telecommunications.
And they are notoriously tough to find and mine.
So, the government wants to incentivise specialists, especially junior mining companies, to participate in this exploration.
Here's how it works:
Companies, known as Notified Private Exploration Agencies (NPEA), submit a bank guarantee.
Against this, they get 30% of the project cost upfront.
This advance will be adjusted in the first bill submitted by the NPEA. They are also required to submit a utilization certificate of the amount.
How Does This Impact The Mining Industry?
Now, let's look at the bigger picture.
India's mining industry is a giant, contributing US$ 54 billion (in FY19) to the economy.
India produces 95 minerals, including 4 fuel-related minerals, 10 metallic minerals, 23 non-metallic minerals, 3 atomic minerals and 55 minor minerals.
It's a major job creator, second only to agriculture.
We're among the world’s largest producers of chromite, coal, iron ore, and bauxite.
And, did you know?
The dry land of Rajasthan is rich in minerals; the State leads the charge in mineral production in India.
The inclusion of the private sector in the mining industry has been a major factor in increasing mineral production.
After all, it accounts for around 67.33% of the total value of the mining industry.
This move is a further step towards privatisation of the industry.
You see, India currently imports more minerals than it exports.
With this move, private companies won’t just stop at mining, they will be incentivised to participate in mineral exploration as well.
And mind you, they will come in with a whole advanced level of technology and expertise.
Higher domestic mineral production: check.
Diversification of mineral sources: check.
Result?
Reduced dependence on countries like China, which currently dominate the supply chain of critical and rare earth minerals.
Think about it – these minerals are vital for everything from smartphones to defense equipment.
By boosting domestic exploration, we're not just diversifying sources.
We're powering up India's manufacturing sector and moving towards self-reliance.
We're powering up and moving towards becoming a $5 trillion economy.
India's mineral potential is huge, with mining licenses spanning a generous 50 years.
With initiatives like Make in India, Smart Cities, Rural Electrification, and a focus on renewable energy, our mining sector is on the brink of a major transformation.
It's a step towards Aatmanirbharta, where we're not just participants but leaders in the global mining industry.
What other industries can India leverage to become a global superpower?
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