Odisha is the leading mineral producing State contributing about 14% of the mineral production of the country. The production of minerals has increased multi-fold over last two decades. This augurs well for the state in wooing investors to build large-scale manufacturing projects. Few initiatives taken by the state government like Integrated Mines and Minerals Management System (i3MS) for computerized, on-line, real-time monitoring of the mines and minerals was the first of its kind in India. Government of India has asked other mineral-bearing States to introduce a similar system. But the moot question is whether the State Government would be able to tap these opportunities by auctioning and opening more new mines in Odisha to give a fillip to the sector and push it forward the state to achieve a more sustainable and inclusive development. In an exclusive interview with Nageshwar Patnaik, former director general of government of India managed Council of Scientific and Industrial Research (CSIR) and founder of Regional Research Laboratory, which is now known as Institute of Minerals and Materials Technology (IMMT), leading metallurgist Padmashree Dr Prafulla Kumar Jena.


NP: Minerals bring wealth and yet according to a survey by Fraser Institute Annual Survey of Mining Companies 2017 on mining and exploration companies, India ranks 97 out of 104 countries in the Investment Attractiveness Index in mining. This clearly indicates that we are not able to attract global investors to mining sector in India. How do you look at the mining industry in general?

Minerals are very valuable natural resource as these are principal raw materials for developing various metal and energy based industries and also are used for producing cement, paints and construction materials for roads and buildings. Unlike water, forest and land resources, these are not renewable. In view of this, minerals should be scientifically harnessed from the mines and utilized properly without any loss as well as avoiding the damage to the environment and other natural resources like water and forest in the mine and adjacent areas.

In this contest, it may be mentioned here that, in India, the technologies adopted in locating and estimating the mineral resources and mining the minerals of all grades with least damage to the environment, are backdated in most cases. There is no proper implementation of scientific procedures in extracting the minerals from the mines and processing the low grade ones. A large number of illegal mining using obsolete technologies causing large amount of wastage of the minerals, are taking place in the country. As a matter of fact, the mining and mineral processing industries are plagued with various problems like technology, capital, infrastructure, marketing, foreign competition and there is want of proper government patronization. Further, there is very little co-ordination amongst concerned government departments and involvement of the local people to materialize the projects. The lack of political will and inadequate infrastructure and service facilities are some of the detriments for attracting foreign investments in this sector.


NP: Odisha is a classic case. Vast mineral deposits in the state should have made this a developed state. But why are we still backward?

It is a fact that, nearly one fourth of various major mineral resources of India are available in Odisha like coal (25%), iron ore (35%), manganese ore (27%), bauxite (50%), chromite (98%), nickel (91%) and ilminite (35%). But, the mineral based industries have failed to contribute significantly to the GDP of Odisha because of the above mentioned reasons. In addition, improper mine plan, wastage of low grade minerals, unscientific use of minerals, lack of political will and also negligible public awareness and concern, are largely responsible for the step motherly attitude towards mines and mineral based industries. In this process, this most valuable wealth of the state is being enjoyed by a few while most of the people are remaining unemployed and poor.

NP: Minerals are the state’s property. Odisha hit the headlines in the media for multi billion crore mining scam a couple of years back. In 2017, the Supreme Court had imposed a fine of Rs 19,174.83 crores on mining leaseholders for environmental and forest clearance violations. What is net impact of the mining scam on this sector?

The unscientific and half hazard technology being applied by most of the mining lease holders in the state, with least care for other resources in the region without properly following the National Mineral Policy, is very common. The indifference of the authorities with practically no monitoring, the public remaining in dark about the grave consequences of these activities and misuse of money and muscle power are mostly responsible for this anti national activity. Most of the mine owners are after making easy money and thus multibillion cores mining scams occur in this sector. This has ultimately resulted in closer of mines and hence in massive setback to the mineral based industries due to dearth of the raw materials. In the larger interest of the state, the government should take necessary steps to stop these unscrupulous practices. .

NP: Now that government has shifted its policy from allocation to auction of mines. How is it going to benefit Odisha?

At present, the Government policy to auction the mines instead of randomly allocating to certain influential individuals will help in harnessing the mineral resources properly by competent Indian as well as foreign companies using environment friendly best available technologies. This will also help in enforcing extraction of all grades of minerals while protecting the environment and restoring forest and water resources, by strictly applying the mineral policy of the Government. Besides, there should be a monitoring system and an effective mechanism to supply the required minerals to existing mineral based industries as well as the new ones in order to boost our GDP.

NP: Major mining leases in Odisha lapsing by March 31, 2020 include the ones held by Rungta Mines, KJS Ahluwalia, Serajuddin & Company, Kaypee Enterprises, Kalinga Mining Corporation, Mid East Integrated Steel Ltd, KN Ram, RB Das, Tarini Prasad Mohanty, KC Pradhan and Lal Traders. Will the government be able to auction 29 operative iron ore mines by the end of this financial year?

I understand that, most of the major mining leases in Odisha are lapsing by March 31st 2020. I would say that, this is a good opportunity for the government to auction the mines. By giving wide publicity, it would be possible to attract the renowned companies both in India and abroad who can harness all grades of minerals using environment friendly best available technologies. In this process, it would be possible to extract much larger amounts of minerals. This would boost the production of mineral based industries and provide more employment opportunities to our youths. It may be mentioned here that, a large number of sponge iron industries in small and medium sectors, have been closed down because of want of iron ores and coal. The government of Odisha should develop an effective mechanism so that these industries can get the required raw materials from the mine owners for fair price.

NP: Hearing a case of environmental violations by Odisha miners, the Supreme Court had asked the government to introduce re-grassing of left over mines which will be a mandatory condition for mining leaseholders in the National Mining Policy, 2019, now being drawn up. What is now being done to green the left over mines?

It is surprising that, the authorities are silent about the half hazard mining of minerals by the lease holders which is being carried out for years without caring for other valuable natural resources in the region like water, forest and the environment in general. Long since, the Central Government has laid down the guidelines to mine the minerals while preserving the forest and water resources in the region and backfilling the mine areas with waste rocks and overburden for further development of these resources. Therefore, the lease holders of the mines should be taken into task and compelled to backfill the mined areas with the over burden. The afforestation should be carried out in the backfilled areas and the rest open pits should be used for rain water harvesting. In this way, the devastated areas after mining can be productive and habitable. The local people can get enough water for domestic, agricultural and fishing activities.

NP: Even as the State has the highest collection of funds under District Mineral Foundation (DMF), it is seriously lagging in timely implementation of the projects. More than Rs 4000 crore still remain unutilized. What is your suggestion to improve the implementation of projects in mining affected areas in the state?

The state of Odisha having largest number of mines of different strategic minerals, it is natural that, the District Mineral Foundation (DMF) of concerned districts should have got large amount of funds amounting to more than four thousand crores of rupees as you mentioned. It is unfortunate that, these are not being utilized properly as it should be in keeping with the Pradhan Mantri Khanij Kshetra Kalyan Yojana (PMKKKY) for utilizing in programmes to ensure long term sustainable livelihood for the affected people in the mining areas. As a matter fact, both Corporate Social Responsibility (CSR) Funds and this should be utilized in projects related to education, health, road, drinking water, and skill development etc., particularly for the affected people. These funds should be utilized under the supervision of a high power committee consisting of the representatives of the affected people (Grama Sabha). Social workers, doctors, educationists and representatives of the mine lease holders and the concerned government departments. A part of the fund should be utilized for awareness programmes for the affected people so that they could know what they are getting and what they are going to miss. In this way, a congenial and productive atmosphere in the area for all stake holders, can be created

NP: Western Odisha is blessed with natural resources where bauxite and coal reserves are in abundance – a unique combination ideal for Aluminium production and the potential to make Odisha as the ‘Aluminium Capital of World’. The state government also has been emphasizing value addition to minerals explored in the state. There are already manufacturing facilities like the case of Vedanta Ltd in Lanjigarh and yet the state government has not been able to provide bauxite to it despite Odisha boasts bulk of bauxite deposits. How is the government addressing this issue?

Odisha is blessed with nearly 50% of the bauxite and 25 % of coal available in India. These two are the principal raw materials for producing aluminium. In addition to this, cheap labour is readily available in the state. Therefore, if these resources are mobilized properly, Odisha can be “Aluminium Capital of the World”. There are three major aluminium producing companies like Nalco, Hindalco and Vedanta. These companies particularly the private ones are not able to utilize their full capacity for producing aluminium due to want of raw materials. For example, Niyamagiri very close to the Vedant plant which as a single mine posses the highest reserve of high grade bauxite in the world. Because of unconstructive politics, the local people are mislead to protest against mining of this resource. As a result, the minerals are not being utilized for the purpose. By the way, the bauxite is generally available on the top of the mine where no trees are seen to grow. Therefore, mining does not affect the vegetation and water resources in the area. If the people living in the area are assured for receiving better education, healthcare, housing and employment opportunities, I am sure; they would not go along with the mischief mongers. The aluminium companies should also import more aluminium scraps to just remelt and purify to produce primary aluminium by consuming only 5% of energy that is required to produce the metal from bauxite. Such practices are followed in most of the advance countries. Further, necessary infrastructural and service facilities should be developed. These companies should also make necessary provisions for utilizing the huge amounts of wastes namely the ‘red mud’ and ‘fly ash’ to make the metal production more environment friendly. The modern technology and mechanization should be applied to make aluminium production more economical. Therefore, a congenial atmosphere with necessary facilities, technology and cooperation of all concerned, is required to make Odisha number one in aluminium production in the world.

NP: The NDA government has set a target to increase share of mining and quarrying in GDP from current 2% of GDP to 5% of GDP over the next 20 years. This requires mining to grow at 10-12% per annum. How can the country achieve this target?

(Ans) – Minerals are high valued natural resources which are essential to develop most of the large scale industries along with creating roads, buildings and other infrastructural facilities. But at present, the mineral resources are not scientifically harnessed and utilized in the country. However, by producing the metals, alloys, energy, cement etc., and the downstream high valued products from the minerals, by utilizing the environment friendly best available technology and providing employment opportunities to different sections of the people, it would be possible to increase the GDP share of minerals from the current 2% to 5%. Along with these, the mined areas should be developed properly through afforestation, rain water harvesting, harnessing of renewable energy from sun and wind etc., so that the area would be productive even after mining and also can provide a lot of employment opportunities particularly to the local people. Thus, in these ways, it would be possible for the mining industry to grow 10 to 12% per annum.

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