Contribution of mining industry of India in GDP

Gondwana, the ancient super continent that existed from the late Precambrian to Jurassic period, comprised today’s Africa, South America, Antarctica, Australia, The Arabian Peninsula and Indian subcontinent.

While its legacy has left many of these regions as rich in mineral resources. India’s utilisation of these resources, especially in term of contribution to GDP is relatively low when compared to its potential.

Mining in India: India’s geological terrain is immensely diverse with a peninsular region being a part of ancient Gondwanaland. It endowed India with vast resources of coal, ferrous and non-ferrous metals.

Coal reserves in India: India has fifth largest coal reserves in the world. Despite this country import a significant amount of coal, primarily due to the quality and energy efficiency of domestically available coal.

Iron ore: India among the top producer of the Iron ore globally, with major deposits found in states like Odisha, Jharkhand and Chhattisgarh.

Other resources: Mica, Bauxite, limestone and Manganese are other important resource deposits in India.

Contribution in GDP: the contribution of mining sector is around 2.5%. in contrast countries like Australia, also part of ancient Gondwana land, have much higher percentage of   contribution of mining sector in GDP.

Factors limiting the contribution in GDP:

  1. Regulatory and policy challenge: the mining sector in India often seen as over regulated leading to delay in clearance and approvals. These regulatory challenges can act as deterrent for private player and foreign investors.
  2. Technological constraints: advanced mining techniques are not ubiquitously implemented across the sector, leading inefficiency and lesser extraction.
  3. Environmental and social concern: many mining activities have often led to environmental degradation and displacement of communities.
  4. Infrastructure bottlenecks: lack of proper infrastructure, especially in transportation, limits the growth of the sector.
  5. Quality of reserves: while India has abundant resources but the quality of some resources is not up to the mark necessitating the import.

Therefore, there is pressing need to reform technological upgrades and a balanced approach.


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