Intro:
India, geologically part of the ancient supercontinent Gondwanaland, is endowed with rich mineral resources (e.g., coal, iron, bauxite, mica). Yet, mining contributes only ~2.5% to GDP (2022-23), compared to higher shares in similarly endowed countries.
1. Factors Behind Low GDP Contribution:
a) Poor Exploration & Technology:
- ~75% of India’s geological area remains unexplored for deep-seated minerals.
- Outdated techniques vs. Australia/Canada’s tech-driven mining.
b) Regulatory Bottlenecks:
- Delays in environmental & forest clearances.
- MMDR Act, 2015 improved auctioning, but challenges remain.
c) Infrastructure Constraints:
- Lack of rail-road connectivity from mines to markets.
- High logistics cost (14% of GDP) makes mining uncompetitive.
d) Land Acquisition & Social Resistance:
- Mining areas often overlap with tribal lands (e.g., Jharkhand, Odisha).
- Rehabilitation & resettlement issues delay projects.
e) Illegal Mining & Corruption:
- Unregulated mining (e.g., Bellary scam) erodes legal output and trust.
f) Environmental Concerns:
- Mining leads to deforestation, displacement, pollution.
- Leads to restrictive environmental regulations.
2. Comparative Global Context:
- Australia & South Africa: Mining contributes ~6–8% to GDP due to efficient policy, tech, and export linkages.
- India exports raw minerals, lacks value-addition (e.g., metal refining).
3. Potential for Growth:
- National Mineral Policy 2019 targets 1% increase in GDP contribution per year.
- Privatization of coal mining (2020) to boost competitiveness.
- Push for critical minerals (lithium, rare earths) under strategic sector reforms.
Conclusion:
Despite its Gondwanaland legacy and vast mineral wealth, India’s mining underperforms due to policy, social, and infrastructural hurdles. Structural reforms, environmental balance, and tech investment are key to realizing its full economic potential.
