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Stoppage of iron ore mining in Goa will impact revenues worth Rs 34 billion, the Goa Mineral Ore Exporters' Association (GMOEA) has said in its letter to the chief minister of the state.
In its letter dated February 12, GMOEA said, as the livelihood of several dependent segments would be affected due to ceasing of mining activities in the state, it would leave the stakeholders of the industry without any alternate source of income.
The Supreme Court last week cancelled 88 iron ore licences in Goa where these lease holders have now been told to stop operating by March 16 and apply afresh for leases.
Stoppage of mining would result in loss of direct and indirect employment in the range of 60,000 and including the dependents would take the figure up to 200,000 of the population, said the letter. Alongside, there is threat to increase of non-performing assets (NPA) for banks as entities in the mining machinery, trucks etc will lose their earning potential thereby burdening financial institutions, it explained.
The total contribution of mining (despite the present cap of 20 million tonne) and its activities to Goa's gross domestic product (GDP) may still be over 10-12 percent, said GMOEA. Such repeated stoppage of mining in the state not just causes revenue damage and job loss within the state but also leads to loss of investor confidence which would be a long-term impact on Goa's economy, said the industry body.
In a bid to rein in illegal mining in Goa, the Supreme Court in September 2012 had imposed a ban on iron ore mining which was lifted only in April 2014. Since then, the state has a mining cap limit of 20 million tonne which has kept the state from exploring its full potential in mining which was over 50 million tonne prior to the ban.
Goa's low-grade iron ore has no application in the domestic market and is largely exported to China and Japan, which earns the state a sizeable foreign exchange. Curtailment of mining in this state has impacted operations of major players such as Anil Agarwal-led Vedanta Ltd and Salgaonkars among others.